Macfarlanes has advised one of the largest hotel property owners in Europe, Pandox AB, on its c€1.4bn recommended cash offer for Dalata Hotel Group plc, including advising on its acquisition finance facilities and on a framework agreement with Pandox’s long-term partner, Scandic Hotels Group AB, to be an operating partner for the existing Dalata portfolio from completion of the acquisition.

Pandox is acting in consortium with Eiendomsspar AS through Pandox Ireland Tuck Limited (Bidco) to make the acquisition, which is fully financed from a combination of existing cash resources available to Pandox and Eiendomsspar and a facility provided to Pandox by its existing lender, DNB Bank ASA.

The acquisition comprises a portfolio of 56 hotel businesses, including 31 freehold and long leasehold properties, 22 leasehold hotels and three managed hotels in the Republic of Ireland, the UK, Germany and the Netherlands.

The acquisition, which is intended to be implemented by means of a scheme of arrangement under Irish law, is conditional on, among other things, the approval of the scheme by Dalata shareholders, receipt of any necessary regulatory or other approvals and the sanction of the scheme by the High Court of Ireland. 

The acquisition is expected to be completed in the fourth quarter of 2025, at which point the parties intend to undertake a separation of the real estate and hotel operating businesses in the Dalata group. Scandic will operate all of Dalata’s hotels under a management agreement from the completion of the acquisition.

Bidco and Scandic have also entered into option arrangements, pursuant to which, in the event of an exercise of an option following the post-completion separation of the real estate and hotel operating businesses, the Dalata hotel operating business may be sold to the Scandic group.

Macfarlanes worked closely with co-counsel Matheson to support the Pandox team in delivering this complex transaction.

The transaction was led by Partners Victoria Hills, Richard Burrows and Max Mittasch, with assistance from Victor Chu, Maeve Sloan and Rhian Edwards.

Finance advice was led by Partner Laura Bretherton with support from Scott Perry. 

Tax advice was provided by Partners Jeremy Moncrieff and Sarah Shucksmith, with support from Beth Leggate. Share incentives input was provided by Partner Rasmus Bergland. Real estate advice was provided by Partner Dan Marriott with support from Tosin Ojukotola and Joe Mukozho. Competition advice was provided by Partner Malcolm Walton. Employment advice was provided by Louise Pereira and Tabitha Al-Mahdawie.

Commenting on the transaction, Victoria Hills said: “It has been a privilege for us to work alongside the Pandox team as they take another significant step in their evolution with this deal. The deal team, led by Jacob Rasin, have worked tirelessly to bring this transaction forward and we share their enthusiasm for their and Dalata’s future. It is clear that the European hotel investment market is alive and well.”