Blue Sea Hotels, a sponsor-backed hotel chain, is assessing several growth options, CEO and shareholder Sebastia Catala told Mergermarket.
The Palma de Mallorca-based company could analyze acquisitions, alliances, managing hotel chains or the entry of an investor into its capital, the executive said. “We want to grow,” he added. Spanish private equity (PE) firm Portobello Capital holds a 95% stake in the company while Catala holds 5%, the executive said.
The company could analyze all growth possibilities, a source close to the situation said. One of the options would be a real estate fund providing fresh money to buy hotels, with the fund owning the assets and Blue Sea Hotels managing them, the source added. Another option would be a financial investor taking a minority stake to support the company’s growth plans, he added.
Portobello has no plans to exit at the moment, the source said. Although the company was acquired by Portobello’s III fund, the PE would like to stay in the company two or three more years as Blue Sea Hotels to compensate for the pandemic, the source added.
Blue Sea Hotels has a score of 26 out of 100, according to Mergermarket's Likely to Exit (LTE) predictive algorithm.* Portobello's long stint in its capital weighs on the score. It invested in 2017.
Portobello had a project before the pandemic to sell the hotels (“the bricks”) owned by Blue Sea Hotels while holding the management of the assets, the source said. That plan was put aside, he added.
The company is targeting EUR 105m in revenues this year and close to EUR 120m next year, Catala said. The company will hit an EBITDA figure this year above 20%-25% over the budget, he added. The company reached EUR 86m in revenues in 2019, just before the pandemic, he added.
Blue Sea Hotels is focused on value-for-money hotels, which are located in holiday destinations and have three or four stars, Catala said. The company owns 26 hotels in Spain (Canary Islands, Balearic Islands, Malaga, Lloret de Mar in Catalonia) with 5,000 rooms, he added.
The company has the support of Portobello in its growth strategy, a Portobello spokesperson said.
*Mergermarket's LTE predictive analytics assign a score to sponsor-backed companies to help track and predict when an exit could occur through M&A, an IPO, a direct listing or a deSPAC transaction.
