Continental to reconsider expansion plan

9 oct 2008 Ziarul Financiar

Radu Enache, who controls the Continental hotel chain, believes he made the right decision when he delayed the listing of the company on the Stock Exchange, a possibility he took into account as early as 2005. "It was a good decision to delay floatation, the more so as we were not seeking to raise capital on the Stock Exchange. Had we been listed, it would have been very difficult at this moment, given the situation on the Romanian Stock Exchange," he said. Enache last year drew inside the chain PPF Czech fund, which owns 40.2% in Conti Hotels, a vehicle with a 76% stake in Continental, according to the latest data. After the deal, Enache said he still considered listing the company on the Stock Exchange, but this decision was postponed. Continental chain is now in full investment process and plans to open several hotels under the two-star Hello brand, three-star Ibis and four-star Continental Forum. "We're carrying out investments to open 25 hotels by 2011. Given the current situation, we must reconsider the plan, because costs have changed," said Enache. The initial investment plan entailed a budget of 135-138m euros by 2011, when the Continental network should include 36 hotels. At present, 15 hotels are operational. Enache said he still kept his money with banks, without being influenced by the state of the European markets.