MEIKLES AFRICA LIMITED
3 September 1999
MEIKLES AFRICA LIMITED
Acquisition of a 50% interest in the Cape Grace Hotel in South
Meikles Africa Limited ('Meikles Africa') the Zimbabwe-based
hotel and retail group quoted on the Zimbabwe and London Stock
Exchanges, has acquired a 50% interest in the Cape Grace Hotel
in Cape Town, South Africa with effect from 1st October 1999.
Meikles Africa has acquired 50% of the business of the Cape
Grace Hotel for US$5.8 million (R35 million, ZW$219 million)
in a joint venture with the founders and operators of the Cape
The joint venture has the right to acquire the hotel building,
which is erected on leased land. The hotel building has been
financed by a South African bank. This financing will be
repaid from hotel revenues and the loan is being secured by
equal guarantees from both the joint venture parties. Meikles
Africa is arranging its guarantee by depositing US$7.46
million (R45 million, ZW$282 million) as collateral from its
US$46 million funds, which have been deposited with the
Reserve Bank of Zimbabwe.
The Cape Grace is a luxury hotel and has a prime position at
the Victoria & Alfred Waterfront development in Cape Town. The
hotel is currently being extended and when complete will
comprise 114 guest rooms and suites, and 5 apartments together
with the Quay West Restaurant.
It is a member of the Small Luxury Hotels of the World and has
won the Small Luxury Hotels of the World 'Hotel of the Year,
1999' award. In addition, the Cape Grace has, for the second
consecutive year, been voted 'South Africa's Best Individual
Hotel' by the Travel and Trade Gazette. The Professional
Management Review has also just announced that the Cape Grace
is winner of the Golden Arrow award for the 'Best Hotel,
1999'. This award is voted on by the Managing Directors of
the 100 largest travel agencies in South Africa.
Southern Africa is increasingly becoming a destination venue
of choice for foreign tourists and numerous synergistic
marketing benefits will be attainable between the Cape Grace
and the Victoria Falls and Meikles hotels, both award winning
members of the Leading Hotels of the World group.
The acquisition of a hotel operation in Cape Town is an
initial step in realising Meikles Africa's aim of acquiring
leading regional hotels. The Company has invested US dollar
capital into a strong regional currency income stream. The
Cape Grace is expected to make a meaningful contribution to
the earnings growth of Meikles Africa.
The transaction is still subject to normal due diligence
John Moxon, Chairman, commented:
'The Cape Grace acquisition represents a significant step for
Meikles Africa into a highly attractive market and a quality
asset, in line with our strategy of expansion into sub-Saharan
Africa within the Group's area's of expertise.'
Meikles Africa Tel: + 263 4 252068 -78
Charles Golding, Finance Director
Andy Lane Mitchell, Company Secretary
Meikles Hotel Tel: +263 4 700561 / 707721
Roy Meiring, Chief Executive
College Hill Tel: +171 457 2020