NH Hoteles, the stock market-listed Spanish hotel group, is close to finalising a deal to buy German group Astron Hotels & Resorts. The move is the latest in what analysts believe will be a bumper year for mergers in the hotel industry.
There had been speculation in the Spanish press about a deal since before Christmas, but now Astron has confirmed that talks are under way. An Astron spokeswoman said the talks are expected to complete within weeks.
The purchase would add 53 hotels and more than 8,000 bedrooms to NH's near-200 hotels and 27,000 bedrooms. In 2000, Astron's hotels had sales of €164m (£101m). Earnings before interest, tax, depreciation and amortisation at the corporation were €15m (£9.2m).
The deal would give NH a network that covered all the main Western European countries with the exception of France and the UK.
Astron's German hotels would complement NH's strength in Spain and the Benelux hotels it bought in the summer of 2000. NH also has close ties to 45-strong Italian chain Jolly Hotels, in which it has a stake of more than 20%.
Astron has the budget chain, Motel One, as well as more upmarket hotels. The potential for budget chains in Germany, Europe's largest economy, has attracted much interest in recent years, and hoteliers such as Whitbread have been trying to enter the market.
The current trading downturn in the hotel business combined with the impact of 11 September has made 2002 a fertile year for many deals in the hotel sector, market experts predict. Last week Accor announced it was buying 15 Rema hotels in Germany.