Fattal buys hotels in Haifa, Beersheva from Tshuva

David Fattal Photo: Rafi Deloya

Fattal will pay companies owned by Yitzhak Tshuva NIS 230 million for the hotels, which have a total of 450 rooms, and which it already manages.

Fattal Holdings (1998) ltd. (TASE: FTAL), which held its IPO six weeks ago, is acquiring two hotels in Israel, which it already manages, from Mirmad and Hof HaCarmel, two private companies controlled by businessperson Yitzhak Tshuva.

The first hotel, Leonardo Negev Beersheva, has 260 rooms. Fattal Holdings wrote in its annual reports published late last week that an agreement in principle had been signed to acquire ownership of the hotel for NIS 130 million.

Fattal, which is already managing the hotel, paid NIS 13 million, 10% of the sale price on March 10, under the agreement in principle. The remaining NIS 117 million will be paid within two months of the completion of the deal, subject to various permits.

The second hotel, Leonardo Plaza Haifa, which is located on the Haifa beach, contains 190 rooms. Fattal's reports say that the company signed an agreement in principle with the companies and Tshuva on March 10, in which Fattal undertook to buy the hotel, which it is currently renting, for NIS 100 million.

Fattal also paid 10% (NIS 10 million) of this amount when the agreement was signed, and will pay the remainder within two months of the deal being finalized, subject to various approvals, including approval from the Israel Land Authority. Approval from the Antitrust Authority was obtained several days ago.

If the deals are delayed, Fattal will deposit 10% (NIS 23 million) of their total amount in a trustee account to be held by the company until the required permits are obtained.

Late last week, Fattal published its first reports since its February IPO, in which it raised NIS 500 million at a company value of NIS 4.5 billion, after money.

Fattal's revenue grew 40% to NIS 2.6 billion in 2017, and its profits rose 44% to NIS 194 million. The trends were similar in the fourth quarter of 2017, with revenue jumping 70% to NIS 791 million and net profit being more than quadrupled to NIS 44 million, compared with the corresponding quarter in 2016.

Fattal attributed the growth in its revenue primarily to the hotels added to the chain and the consolidation of the results of Protal Tourism, which has 10 hotels in Israel. Fattal, controlled by founder, chairperson, and CEO David Fattal, currently includes 170 hotels with 33,000 rooms in 17 countries, including Israel, where the group has 40 hotels.

Fattal Holdings' share price has risen 17% since the IPO, increasing its market cap to NIS 5.3 billion. The company is likely to enter the Tel Aviv 35 Index when the indices are revised.

Published by Globes [online], Israel business news - www.globes-online.com - on April 3, 2018

© Copyright of Globes Publisher Itonut (1983) Ltd. 2018

David Fattal Photo: Rafi Deloya
David Fattal Photo: Rafi Deloya
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