Publication of formal documentation

29 March 2016

PPHE Hotel Group Limited

PPHE Hotel Group publishes formal documentation relating to the takeover offer for Arenaturist in Croatia

PPHE Hotel Group Limited (the Company), which together with its subsidiaries (PPHE Hotel Group) owns, leases, develops, operates and franchises full service upscale and lifestyle hotels in major gateway cities and regional centres, predominantly in Europe, is pleased to announce that it has today published the formal documentation relating to the takeover offer for Arenaturist d.d.

Summary

·      On 1 March 2016, PPHE Hotel Group announced that its wholly owned subsidiary Euro Sea Hotels N.V. (the Bidder) had entered into an agreement to acquire the remaining 80% interest, which it does not currently own, in its joint venture in Croatia (the Acquisition).

·    The joint venture indirectly owns 74.15% of the issued share capital of Arenaturist d.d (Arenaturist), a Croatian public company whose shares are traded on the Zagreb Stock Exchange.  As a result of the Acquisition, PPHE Hotel Group is required to make a mandatory takeover offer (the Offer) for the outstanding share capital of Arenaturist.

·    In connection with the Acquisition the approval of the Arenaturist shareholders is being sought for the election of four new members nominated by PPHE Hotel Group to the Management Board of Arenaturist.  A General Assembly of Arenaturist has been convened on 13 April 2016 to consider such elections. The Acquisition is expected to complete shortly after the General Assembly.

·    As required by Croatian law and regulation, the Offer was published today on the Zagreb Stock Exchange. The Offer will remain open for 28 days from tomorrow (being the date of its publication in the Croatian National Gazette). The documentation relating to the Offer contains a statement relating to PPHE Hotel Group's future intentions for Arenaturist.

·    The offer price has been confirmed at HRK325.73 per Arenaturist share. The offer price values the issued share capital of Arenaturist at €94.4m (approximately) and the outstanding shares to which the offer relates (25.85%) at €24.4m (approximately).

Future intentions of PPHE Hotel Group in relation to Arenaturist

The documentation relating to the Offer contains a statement relating to PPHE Hotel Group's future intentions for Arenaturist, a translated extract of such statement is set out below.

"PPHE Hotel Group intends to continue to operate Arenaturist as an independent business with its own management. 

Following completion of the Takeover Bid and the change of directors at the General Assembly on 13 April 2016, PPHE Hotel Group intends to put forward proposals to join, through acquisition or merger, its Croatian assets and operations which currently do not directly form part of Arenaturist (Arenaturist Hoteli d.o..o, Arenaturist Zlatne stijene d.o.o. and Arenaturist Turistička naselja d.o.o.) along with the hotels and hotel operations owned by the Bidder independently or with partners which may include some of the following hotels: Park Plaza Wallstreet Berlin Mitte, Park Plaza Berlin Kudamm, art'otel berlin mitte, art'otel berlin kudamm, art'otel cologne (Köln) and Park Plaza Nuremberg (under construction), all located in Germany and art'otel budapest located in Hungary, into Arenaturist. 

As part of the process referred to above and to further the expansion of Arenaturist both inside and outside of Croatia, Arenaturist will be vested with a licence to use the Park Plaza brand in Croatia, Germany, Austria, and various other countries of Central and South Eastern Europe. Following which, it is PPHE Hotel Group's expectation that Arenaturist will be strongly positioned to be able to acquire and develop new hotels or to attain new management contracts for hotels owned by third parties within Central and South Eastern Europe.

Following completion of the process referred to above, PPHE Hotel Group is proposing to transfer the listing category of all of Arenaturist's shares from the Regular Market to the Official Market of the Zagreb Stock Exchange. It is anticipated that such transfer will provide exposure to a wider investor base, enhance the liquidity of Arenaturist's shares, heighten Arenaturist's profile and provide greater flexibility to grow Arenaturist's business.

PPHE Hotel Group's ambition is that Arenaturist develops into a substantial Central and Eastern European leisure and hospitality company with a business model that would entail owning and managing its own assets and those of others under the Park Plaza brand."

A copy of the full takeover documentation, in Croatian, is available from the Zagreb Stock Exchange website www.zse.hr.

Enquiries:

Notes to editors

PPHE Hotel Group Limited is a Guernsey registered company and through its subsidiaries, jointly controlled entities and associates, owns, leases, operates, franchises and develops full service upscale and lifestyle hotels in major gateway cities and regional centres, predominantly in Europe.

The majority of PPHE Hotel Group's hotels operate under two distinct brands, Park Plaza^® Hotels & Resorts and art'otel^®. PPHE Hotel Group has an exclusive licence from Carlson, a global privately held hospitality and travel company, to develop and operate Park Plaza^® Hotels & Resorts in Europe, the Middle East and Africa. The art'otel^® brand is fully owned by PPHE Hotel Group.

PPHE Hotel Group has a minority ownership interest in the Arenaturist group, one of Croatia's leading hospitality companies.

The portfolio of owned, leased, managed and franchised hotels comprises 38 hotels in operation offering a total of more than 8,300 rooms. The development pipeline includes five new hotel projects and one hotel extension and reconfiguration. These developments are expected to add nearly 1,100 rooms to our portfolio by the end of 2016 and an additional 500 rooms by the end of 2019.

Our Company:

www.pphe.com

Our Hotel Brands:

www.parkplaza.com

www.artotels.com

www.arenaturist.com

For images and logos visit www.vfmii.com/parkplaza

Forward-looking statements

This trading statement may contain certain "forward-looking statements' which reflect the Company's and/or the Directors' current views with respect to financial performance, business strategy and future plans, both with respect to the group and the sectors and industries in which the group operates. Statements which include the words "expects", "intends", "plans", "believes", "projects", "anticipates", "will", "targets", "aims", "may", "would", "could", "continue" and similar statements are of a future or forward-looking nature. All forward-looking statements address matters that involve risks and uncertainties. Accordingly, there are or will be important factors that could cause the group's actual results to differ materially from those indicated in these statements. Any forward-looking statements in this interim management statement reflect the group's current views with respect to future events and are subject to risks, uncertainties and assumptions relating to the group's operations, results of operations and growth strategy. These forward-looking statements speak only as of the date of this interim management statement. Subject to any legal or regulatory obligations, the Company undertakes no obligation publicly to update or review any forward-looking statement, whether as a result of new information, future developments or otherwise. All subsequent written and oral forward-looking statements attributable to the group or individuals acting on behalf of the group are expressly qualified in their entirety by this paragraph. Nothing in this publication should be considered as a profit forecast.