African Sun terminates hotel sale agreements with TD hotels

Hospitality group African Sun Limited (ASL) has announced the termination of its agreements for the sale of two hotels to TD Hotels & Leisure (Private) Limited. The decision comes as ASL had previously entered negotiations to sell the Beitbridge Hotel and the Great Zimbabwe Hotel to the budding Harare-based hospitality group.

In a statement released last Thursday, ASL revealed that the agreements, which were classified as a category 3 transaction by the Zimbabwe Stock Exchange, have been terminated. The company did not provide specific reasons for this decision.

ASL was poised to receive $4,445,000 from the sale of the Great Zimbabwe Hotel and its associated business in Masvingo, as well as $2.5 million from the disposal of the Beitbridge Express Hotel. The proceeds from these sales were intended to support the group's capital-raising initiatives aimed at expediting the refurbishment of several key hotels in its portfolio.

In its half-year report for the period ending June 30, 2024, released earlier this month, ASL noted that the board had resolved to complement its capital-raising efforts by selling selected assets deemed non-core to the group's future positioning. The Beitbridge Express Hotel and Great Zimbabwe Hotel were specifically earmarked for sale, and an agreement for the latter was executed on August 15.

Before the termination of the deal, the transactions were expected to be completed before the end of the year. The hospitality group has indicated that it will provide further updates on its future plans and any material changes arising from this decision.

As the hospitality industry continues to navigate challenges, ASL's focus remains on revitalizing its offerings and ensuring a strong positioning within the competitive market. The termination of the hotel sale agreements marks a significant development in the group's strategy moving forward.