Sabari Group Acquired Nilgiris Nest
Hotel chain Sabari Group has acquired three properties of Nilgiris Nest for around Rs 100 crore, consolidating the group’s hospitality business. The acquisition of 105 rooms in Chennai, Bangalore and Coimbatore, put together comes with a debt component of Rs 65 crore from the State Bank of Hyderabad. Promoted by Mr KRV Ramani, the hospitality venture, under the Sabari Inn brand, started with 72 rooms in Chennai in 2002. “The new entity will be known as Sabari Nest Inn,” he told here on Tuesday.While the Nilgiris Supermarkets would continue their existing retail operations as lessees, he said Sabari had entered into a 10-year lease period with Nilgiris. The MoU was signed in July this year. All the 200 employees of Nilgiris in the hospitality division have been absorbed, taking the Sabari Group’s total employee strength to 600.
The hospitality arm of Nilgiris, in which UK-based PE investor Actis has a substantial stake, contributes about Rs 8 crore to the turnover. The three properties cover an area of over 1.45 lakh sq ft and a sum of Rs 3 crore has been allotted for renovation. “We plan to start this after January in a phased manner,” he said, adding, the existing tariff would be revised by 10-15% from April, if necessary. By March 2009, he expects Sabari Nest to clock a turnover of Rs 35 crore. Last year, Sabari Inn started the second hotel on old Mahabalipuram Road, with 90 rooms. This was followed by a 50-room hotel acquisition in Kodaikanal, which is under renovation.
Outlining other expansion plans, Mr Ramani said the group is adding three more hotels with 120 rooms each in Coimbatore, Pune and Bangalore. “We have bought one acre in Pune. This one would be ready by next April or May. Once all projects are commissioned, our turnover would be Rs 150 crore and we would have 700 rooms by 2012,” he added. Sabari, which has a tie-up with international hotel chain Quality Inn has 300-plus rooms — occupancy levels range between 65% and 85%. There has been a drop in occupancy, COO Ramesh Shiva said, noting that occupancy levels of foreigners has come down to 5%, down from the usual 12% (November to January) on account of global recession and the Mumbai terror attacks.
