Grand Hotels Acquisition Company Limited, a company formed and financed by Nomura International plc's Principal Finance Group ("PFG"), announces the acquisition of Principal Hotels from a consortium composed primarily of Bridgepoint Capital and PPM Ventures. The consideration is £255 million.

Principal Hotels was originally the subject of a £68 million LBO in March 1994 led by Bridgepoint Capital. During that period, the portfolio has been repositioned through a programme of disposals, selective acquisitions and capital investment.

Principal Hotels is now made up of 17 hotels, 14 in the UK, two in Copenhagen and one in Amsterdam. It also holds one management contract in Dublin. Principal Hotels is focused on the 4-star business and conference hotel market with a number of well-known hotels in the UK including the Russell in London, Selsdon Park in Surrey and the Palace Hotel in Manchester.

Juergen Bartels, who was previously Chief Executive of Starwood Hotels, will become Executive Chairman, and Tony Troy will continue as Managing Director.

Guy Hands, Managing Director of PFG, said:

"Principal is an excellent chain of hotels in the growing business and conference market. It has a respected management team which is now joined by Juergen Bartels who is recognised as one of the most successful hoteliers in the world. The combination of his skills with PFG's proven capability to regenerate customer-facing businesses should make for an exciting future."

ndrew Dowler
020 7831 3113
Nomura International plc