HARARE – African Sun Limited plans to sell its Holiday Inn properties in Harare, Bulawayo and Mutare as part of a portfolio restructuring exercise aimed at r...
HARARE – African Sun Limited plans to sell its Holiday Inn properties in Harare, Bulawayo and Mutare as part of a portfolio restructuring exercise aimed at raising about US$11 million to reacquire a 50 percent interest in The Victoria Falls Hotel Partnership and finance refurbishment of the landmark property.
The company announced the proposed disposal in a portfolio update on Thursday, saying its board had approved the sale of the three Holiday Inn properties to fund the acquisition of Meikles Hospitality’s interest in The Victoria Falls Hotel Partnership and the associated refurbishment programme.
“In order to finance the acquisition of Meikles leasehold interest and the associated $11 million dollar refurbishment of the hotel, the Board of African Sun have resolved to dispose of the group’s Holiday Inn portfolio, which consist of hotels in Harare, Bulawayo and Mutare,” the company said.
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The proposed transaction follows an agreement between African Sun and Meikles Hospitality that would see African Sun reacquire the 50 percent share in The Victoria Falls Hotel Partnership that Meikles has held since 1998.
African Sun said it had signed a cessation agreement with Meikles Hospitality, with the transaction subject to final regulatory approvals and the consent of the property’s landlord.
“Shareholders and the public are advised that, subject to final regulatory approvals, African Sun has, with the landlord’s blessing and consent, signed a cessation agreement with Meikles Hospitality to re-acquire the 50 percent share in The Victoria Falls Hotel Partnership held by Meikles since 1998,” the group said.
If completed, the transaction will give African Sun full ownership of The Victoria Falls Hotel Partnership and allow the company to take full management and operational control of the property.
The Victoria Falls Hotel is also expected to undergo further refurbishment as part of the agreement. African Sun said the refurbishment has been approved by the hotel’s landlord, Emerged Railways Properties, and will be funded entirely by African Sun.
“As part of the agreement signed with Meikles and associated approvals granted by the landlord, the Emerged Railways Properties, the hotel will undergo further refurbishment, to be funded entirely by African Sun,” the company said.
The planned US$11 million investment will therefore cover the acquisition of Meikles Hospitality’s interest and the refurbishment requirements associated with the Victoria Falls property.
To generate the required funding, African Sun has opted to dispose of its Holiday Inn portfolio, which comprises properties in Harare, Bulawayo and Mutare.
The proposed sale will, however, require several approvals before it can be completed. African Sun said consent would be required from InterContinental Hotels Group (IHG), the franchisor of the Holiday Inn brand.
The transaction will also require approval from the NRZ Contributory Pension Fund, which is the landlord for the Harare and Bulawayo Holiday Inn properties.
In addition, the disposal will require clearance from Zimbabwe’s Competition and Tariff Commission.
These approvals mean the planned disposal is not yet complete. African Sun’s proposed timeline remains subject to the necessary regulatory and other consents.
The company is targeting September 2026 to assume full management and operational control of The Victoria Falls Hotel.
The handover of the Holiday Inn properties is planned for January 1, 2027, also subject to the required approvals.
The proposed restructuring would therefore result in a change to African Sun’s hotel portfolio, with the company seeking to move away from ownership of the three Holiday Inn properties while increasing its interest in one of Zimbabwe’s best-known hotel properties.
The Victoria Falls Hotel Partnership has been jointly held by African Sun and Meikles Hospitality, with Meikles holding its 50 percent share since 1998.
The proposed reacquisition would end that arrangement and give African Sun full ownership of the partnership.
The transaction also comes with a significant refurbishment commitment. African Sun said the planned work at The Victoria Falls Hotel would be funded entirely by the company after approval from Emerged Railways Properties.
The board’s decision to dispose of the Holiday Inn portfolio is therefore directly linked to the funding requirements for the Victoria Falls transaction.
African Sun has not indicated in the information provided how much each individual Holiday Inn property is expected to generate from the disposal. The company has instead stated that the overall transaction is intended to finance the acquisition and the associated US$11 million refurbishment.
The company has also not announced the identities of prospective buyers for the Holiday Inn properties.
The three properties affected by the proposed disposal are located in Harare, Bulawayo and Mutare, giving the planned transaction implications for African Sun’s hotel portfolio across three major Zimbabwean cities.
The Holiday Inn brand is operated under a franchise arrangement with IHG, meaning African Sun will require the franchisor’s consent as part of the proposed change in ownership.
The NRZ Contributory Pension Fund’s approval is also required for the Harare and Bulawayo properties because of its role as landlord.
The Competition and Tariff Commission will also have to clear the transaction before the disposal can proceed.
African Sun’s proposed timetable indicates that the company intends to complete the Victoria Falls transition several months before the planned handover of the Holiday Inn properties.
The company is targeting September 2026 for full management and operational control of The Victoria Falls Hotel, while the Holiday Inn properties are scheduled for handover on January 1, 2027.
Both dates remain dependent on the relevant approvals.
For African Sun, the transaction represents a restructuring of its property portfolio centred on securing full ownership of The Victoria Falls Hotel Partnership and investing in the refurbishment of the landmark hotel.
The company said the proposed acquisition and refurbishment would require approximately US$11 million, prompting the board to approve the disposal of the Holiday Inn portfolio as a funding measure.
The proposed transaction does not yet represent a completed sale of the Holiday Inn properties. Regulatory approvals and other required consents must still be obtained before the handover can take place.
African Sun’s shareholders and the public will therefore need to await further announcements on the progress of the approvals, the disposal process and the eventual transition of the properties.
If all approvals are obtained, African Sun expects to take full control of The Victoria Falls Hotel in September 2026 and hand over the Holiday Inn properties on January 1, 2027.
The company said the Victoria Falls refurbishment would be funded entirely by African Sun, while the disposal of the Holiday Inn portfolio is intended to provide the funding required for the wider transaction.
The proposed restructuring marks a significant change in African Sun’s hotel portfolio as the company prepares to increase its ownership of The Victoria Falls Hotel while exiting ownership of its Holiday Inn properties in Harare, Bulawayo and Mutare.
