Leading hospitality company, Southern Sun Africa, has announced plans to leave Nigerian market amid financial troubles.
The South African investment company is expected to sell off one of its subsidiaries, Southern Sun Hotels in the Ikoyi area of Lagos to offset its debt.
The COVID-19 pandemic had negatively impacted Southern Sun Africa’s revenue and in a bid to cut its losses, the company will sell its 75.55 percent stake in the hotels to Kasada Albatross Holding for $30.4 million.
The deal currently awaits the Federal Competition and Consumer Protection Commission (FCCPC) and the Security and Exchange Commission (SEC)’s approval.
Southern Sun Africa chose to save its Mozambique subsidiary with the sale of its business in Nigeria.
The deal will provide the firm with enough cash to offset its $26.6 million debt owed foreign creditors in the Southern African nation.
It will also free Southern Sun Africa from the $12.8 million debt owed by the Ikoyi Hotel, and allows the South African company to restructure its operations following the financial loss induced by the COVID-19 pandemic.
Ripples Nigeria gathered that the new owner of Southern Sun Ikoyi Hotels, will change the name to Novotel, falling under the French-owned multinational hospitality conglomerate, Accor Group.
The Accor Group is one of the investment vehicles backing Kasada Albatross Holding’s parent firm, Kasada Hospitality Fund LP.
Kasada Hospitality Fund LP also draws capital from the Middle East sovereign wealth fund, Qatar Investment Authority.