MISSISSAUGA, ON, Sept. 28, 2017 /CNW/ - Temple Hotels Inc.
("Temple" or "the Company") (TSX: TPH) announced today that the
Company has completed the sale of the Holiday Inn Express Hotel
& Suites in Sherwood Park, a
suburb of Edmonton, AB. The
disposition was completed for $9.6
million, excluding taxes and transaction costs.
"This divestiture is an important step in the execution of our
strategic plan that will drive the long-term success of the
Company," said K. Rai Sahi, Chief
Executive Officer. "The opportunistic sale of this property enables
us to meet our financial obligations while continuing to
strategically diversify the Company's portfolio and decrease our
reliance on a single geographic market."
The sale comes as Temple moves to mitigate exposure in
Alberta, which continues to be
impacted by the oil-related economic downturn, as part of the
Company's overarching growth strategy. Temple's second quarter
results showed positive progress and a strengthened financial
position, with the Company posting increases in net income and
revenue over previous periods.
The Company used the proceeds of the sale to repay $9.1 million of mortgages payable secured against
the property. As reported in an earlier update, Temple has resolved
five of the ten covenant violations reported at June 30, 2017. The Company continues to work
diligently with its lenders to resolve the remaining mortgage
covenant violations, which have primarily been caused by the
downturn in the Alberta market.
The outstanding breaches are expected to be resolved by debt
refinancing, loan modifications agreements and/or a waiver of the
covenant requirements.
"We appreciate the support of our lenders as we continue to make
progress that will deliver the long-term success of Temple," said
Sahi.
About Temple Hotels Inc.
Temple is a growth oriented hotel investment company with hotel
properties located across Canada.
Temple is listed on the Toronto Stock Exchange under the symbols
TPH (common shares), TPH.DB.E and TPH.DB.F (convertible
debentures). The primary long-term investment objectives of the
Company are to yield stable and growing cash flows and to maximize
the long-term share value of the Company through the active
management of its assets, accretive acquisitions, and the
performance of value-added capital improvement programs on selected
properties, as deemed appropriate. For further information on
Temple, please visit our website at www.templehotels.ca.
This press release contains certain statements that could be
considered as forward-looking information. The forward-looking
information is subject to certain risks and uncertainties, which
could result in actual results differing materially from the
forward-looking statements.
SOURCE Temple Hotels Inc.