MADRID (Investment Europe) NH Hoteles, Europe's third largest business hotel operator by rooms count and owner of Sotogrande S.A., has long been tipped as a private equity target given its large debt and that of its savings bank shareholders, which together own nearly a third of the firm. According to Spanish media, KKR could invest in NH Hoteles by first acquiring a 15.7% stake held by the parent of nationalised lender Bankia, worth about €100m or through a capital. NH Hoteles has nearly €1bn of debt and €193m of operating cash flow in 2011, and has been trying to sell its assets to COMING SOON:
SUBSCRIPTION INFORMATION cut debt by a quarter in the next three years. Given the current outlook of the domestic banking sector, Spanish savings banks have been viewed as unstable shareholders, and NH Hoteles is now understood to be in the process of analysing the proposal tabled by KKR. While NH Hoteles' business was severely hit by recession in Spain and Italy, two of its main markets, it is looking to access new European markets such as Germany, Central Europe and Latin America, which could bring profits to KKR.