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High Tech Hotels

High Tech Hotels

Invested:
February 2002

Exited:
January 2003

Sector:
Leisure and retail

Headquarters:
Madrid

Region:
Spain

Business:
Hotel chain

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Business at time of investment

High Tech Hoteles was a start-up hotel chain, led by an experienced management team, which owned several hotel brands.

Investment rationale

As the world’s largest tourist market, Spain was dominated by small family-owned hotels with a low presence of large-scale chains, particularly in the three-star segment. Palamon believed there was an opportunity to build out a sizeable chain of hotels based.

Value creation

  • Focused the company’s strategy on three- and four-star city centre segment
  • Introduced expert hotel consultants to help the founders reset their brand management policies, consolidating four brands in to one.
  • Developed a robust financial model to measure and monitor KPIs in all development projects.

Result

Having experienced that the ramp up of hotel units took longer than initially forecast, Palamon took the opportunity to sell its stake to a local private equity firm within one year to return an early result to the Funds.