AIB has emerged as the financial backer of the Doyle family's bid to take the Jurys Doyle hotel group private. Sources close to the bank have confirmed that it is providing support to the bid, the details of which are due to announced in the next few days. John McManus reports.
The Doyles have indicated that they will bid at least €18.90 per share for the company, valuing it at just under €1.2 billion. The consortium, which is being advised by Goldman Sachs, is still finalising due diligence.
Along with fellow shareholders the Beatty family and Elizabeth Nelson, the Doyles already control 42 per cent of the company. The consortium is looking to increase its shareholding to a minimum of 50 per cent plus one share. This would give it sufficient control of the group to facilitate the sale or redevelopment assets, which include a number of Dublin hotels in prime development sites. They include the Berkeley Court in Ballsbridge, the Burlington in Donnybrook, the Montrose near University College Dublin and the Westbury off Grafton Street.
The Doyle-led consortium could comfortably reach the 50 per cent level if it can gain the support of property developer Liam Carroll, who controls 8.3 per cent of hotel group. The Doyles have already sought an irrevocable undertaking from Mr Carroll to support their bid, which he has declined to give to date.
If the Doyle consortium succeeds in reaching 50 per cent, it would leave the other large shareholder, Sean Dunne, isolated despite having built up a 27.8 per cent stake in the group in recent months.
Mr Dunne will shortly have to complete the €260 million purchase of the Jurys Hotel site in Ballsbridge that he has separately agreed to buy from the company. Sources speculated last night that Mr Dunne's backers may put him under pressure to liquidate his stake in Jurys once the deal goes through if he looks unable to win control of the company.
If, on the other hand, Mr Dunne was in a position to remain on the share register, he could make life difficult for the Doyles every time they tried to make a major decision such as a land sale. Mr Dunne is also reported to be considering an offer and has paid up to €19.50 for batches of shares.
Any such bid would probably require the support of private equity funds - Orion is one fund that has been mentioned - and they would seek a significant degree of control.
Mr Dunne may yet choose to circumvent this process by accepting the Doyle offer, which will still leave Mr Carroll in a pivotal position. Even with Mr Dunne's shares, the Doyle consortium may need Mr Carroll's support to get over the 80 per cent threshold which would allow them compulsorily acquire the outstanding shares.
