Whitbread share price dips as group snaps up hotels in Germany

Whitbread’s (LON:WTB) share price has fallen in London this Monday as the Premier Inn owner announced that it was buying a portfolio of hotels in Germany, for an undisclosed amount. The update comes in the wake of the sale of the group’s Costa Coffee business to The Coca Cola Company earlier this year.

As of 13:02 BST, Whitbread’s share price had given up 1.92 percent to 4,404.00p, underperforming the broader UK market, with the benchmark FTSE 100 index currently standing 0.39 percent lower at 7,316.26 points. The group’s shares have given up more than six percent of their value over the past year, as compared with about a 2.4-percent fall in the Footsie.

Whitbread snaps up Acomhotel

Whitbread announced in a statement today that it had acquired a portfolio of three independent hotels in Germany, from a private individual operating under the brand ‘Acomhotel’. The company did not disclose the financial details of the deal, which marks the Premier Inn owner’s second acquisition in the country. The FTSE 100 group noted that the deal was part of its long-term investment plan in what it referred to as a highly attractive market.

“We have accelerated our investment in Germany through a mix of organic expansion, supported by focused and ongoing M&A activity,” Mark Anderson, Whitbread PLC Managing Director Property & International, commented in the statement.

Premier Inn currently has three hotels open in Germany, with a further 40 now in the committed pipeline across 16 cities in the country.

Analysts on FTSE 100 company

The 23 analysts offering 12-month targets for the Whitbread share price for the Financial Times have a median target of 4,500.00p, with a high estimate of 5,750.00p and a low estimate of 2,000.00p. As of September 20, the consensus forecast amongst 23 polled investment analysts covering the Premier Inn owner advises investors to hold their position in the company.

JPMorgan Cazenove recently reinstated Whitbread as ‘underweight,’ pointing to deteriorating business momentum in the UK and the completion of the group’s share buyback.