Tourism services group Tourvest, eager to expand its reach into the accommodation sector of the tourism market, has made its second acquisition in a month with the purchase of the Makalali Game Lodge in Limpopo.

The group did not put a value to the deal, but Tourvest director Jan Roesch said it was worth between R25m and R30m, with the group set to spend a further R5m to refurbish the lodge and start a buffalo-breeding plan.

Tourvest last month bought the four-star Adderley Hotel in Cape Town and an interest in the hotel management company Relais Hotels as the first step in establishing a presence in the accommodation sector of the tourism market. That acquisition cost R23m.

The group's expansion into the accommodation market was part of a broader strategy to move into tourism property to maximise value from tourist volumes directed by its travel agency and tour operator businesses, said Roesch.

The plan will eventually see Tourvest spending R150m-R200m on the selective expansion of its property portfolio to include accommodation on the Garden Route and in the Lowveld.

The investments will all be made from internal cash resources and are all expected to cost in the region of R30m.

Tourvest expects good occupancy rates for its recently acquired lodges and hotels.

Roesch said proper marketing would help to establish Makalali Game Lodge as a premium safari destination.

Negotiations for an acquisition in the Lowveld were also well advanced with the announcement of a deal expected next month, but opportunities in the Garden Route were proving to be more elusive, Roesch said.

The purchase of Makalani is still subject to regulatory approval.

The 6000ha-lodge comprises four camps with accommodation for 48 people.

It was in the Greater Makalali Game Reserve, a private conservancy about 60km from Hoedspruit, to the west of Timbavati, the group said in a Sens announcement yesterday.

News of the acquisition pleased the market with shares in the tourism group gaining 5c, or 3,03%, to R1,70.

Tourvest plans to spend in the region of R4m to upgrade the lodges to four-star quality and an initial R1m will be spent to introduce buffalo to make Makalali a "big five" reserve.

Business Day
Publisher: I-Net Bridge
Source: I-Net Bridge