Branded hotel operator CHE Hotel Group is to raise nearly £20m through a share placing to fund expansion of its Sleep Inn hotels in the UK.
The company, which operates four separate brands, hopes to use £8.6m of the money raised to develop Sleep Inns in 60 locations in the UK.
CHE Hotel Group chairman Peter Catesby said the group's recent opening of the Sleep Inn hotel in Tewkesbury, Gloucestershire, had shown demand for this type of limited service accommodation.
"Today's equity raising will enable the group to exploit that opportunity over the coming years, while allowing for standards to be raised in the remainder of the group's existing hotels where required," he added.
A further £10m will be used to refurbish and improve the group's 58 owned, managed or leased hotels, which operate in the mid-market full-service and upmarket full-service sectors, under the Comfort, Quality and Clarion brands.
The group owns two hotels, leases 45 and operates 11 others on a management basis.
The net proceeds from the placing, underwritten by KBC Peel Hunt, will be about £18.6m. Dealings in the shares should start on 18 January.
By James Garner
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