Mantra result not timed, says boss

MANTRA boss Bob East has denied that the release this week of a strong financial result for the Gold Coast-based hotel group was timed to spur interest in the sale of the $400 million company.

Mantra this week announced it had achieved 9 per cent growth in its gross earnings.

It also said overall room revenue for the Peppers, Mantra and BreakFree hotels had risen by 6.2 per cent last financial year.

Mr East, who is forecasting 2012-13 also would be a strong year for the company, said release of the Mantra Group financial figures was not related to the sales process.

"These numbers won't hurt," said Mr East, who is a Mantra shareholder. "But the results were already known by the bidders.

"So putting them out to gain publicity won't make any difference. It had nothing to do with the sale."

Private equity group CVC Asia Pacific confirmed in March it was selling its stake in Mantra.

So far the InterContinental Hotels Group and private equity firm Archer Capital appear to be the most likely buyers but Starwood Capital and Rydges Hotels and Resorts owner Amalgamated Holding are also believed to be interested in the company.

Mr East said yesterday the preferred bidder should be confirmed before the end of the month.

CVC acquired 65 per cent of Mantra from MFS in 2008 for $409 million in a deal that also involved taking on $906 million in debt.

CVC later acquired the rest of Mantra, then known as Stella Group and which also had been held by MFS, for just $3.5 million.

Investment bank UBS, which is now advising CVC on the sale process, came on board with a 40 per cent stake in the Mantra Group after converting the remaining debt to equity.

Mantra's senior management also owns about 10 per cent of the company.

Source: GoldCoast.com.au, 19 July 2012