South Africa’s City Lodge Hotel Group has announced its exit from Kenyan market, by opting to sell its three hotels including Fairview Hotel, Town Lodge and City Lodge Two Rivers.
The group will also sell its City Lodge Hotel in Dar es Salaam, saying that it has already received an offer from a willing buyer.
“Shareholders are advised that following receipt of an unsolicited non-binding offer for the proposed acquisition of City Lodge’s East African operations, comprising of its hotels situated in Kenya and Tanzania, the company has entered into negotiations which, if successfully concluded, may have a material effect on the price of the Company’s securities,” said City Lodge Hotel Group at the Johannesburg Stock Exchange.
The firm has not revealed the reason behind the exit, which includes South Africa, Botswana, Namibia and Mozambique, but it is suspected that it has been experiencing sluggish income occasioned by the Covid-19 pandemic. The hospitality industry has been hard-hit due to the slow down of the tourism industry.
“The 2020 financial year was our most challenging operating year in the group’s 35-year history, mainly due to the lockdown protocols implemented by the South African government, and similar restrictions in the rest of Africa countries in which the group operates,” said Chairman Bulelani Ngcuka as quoted by Business Daily.
City Lodge acquired its first hotel in Kenya in 2012, Fairview Hotel, before opening another outlet at Two Rivers in 2018.