Oxley Holdings has accepted a letter of intent to purchase the Mercure and Novotel Hotels for S$950 million (US$702.6 million), according to a statement late Thursday (10 January).
The LOI is non-binding and is subject to the parties entering into a definitive sale and purchase agreement. The identity of the buyer wasn’t disclosed.
Under the terms, upon receipt of the sum of $9.5 million, the purchaser shall be entitled to carry out property due diligence during the period up to 15 April 2019.
The buyer will then shall pay $38 million on 28 February, and a further $47.5 million on the signing date of the definitive sale and purchase agreement or 15 April.
Oxley in 2013 acquired the land in Stevens Road, where the defunct Pines Club, formerly known as The Pinetree Club, used to be, for $318 million from Exklusiv Resorts. The leasehold estate comes with a 103-year tenure from July 2013. The company in 2014 appointed hotel operator Accor to manage the 254-room Novotel Singapore on Stevens and 518-room Mercure Singapore on Stevens which were opened late 2017.
Oxley shares are up 8.5 per cent to S$0.32 at 10.31 am after trading resumed today. Oxley shares were halted from trading from 3pm on Thursday pending the announcement.