Mantra to Acquire Outrigger Australia

Mantra Group has entered into an agreement to acquire Outrigger Hotels & Resorts Australia for $29.5 million, subject to customary completion adjustments and conditions.

As a result, Mantra Group is launching a fully underwritten institutional placement to raise approximately $50 million to assist in funding the Outrigger Acquisition as well as providing Mantra Group with additional capital to fund identified pipeline opportunities.

Mantra Group will also offer all existing eligible shareholders in Australia and New Zealand the opportunity to acquire additional shares (up to a fixed amount) via a non-underwritten Share Purchase Plan.

A copy of the investor presentation relating to the Outrigger Acquisition and the Equity Raising has been lodged separately with ASX (ASX code: MTR).

Outrigger Acquisition

Mantra Group, via a wholly owned subsidiary, has agreed to acquire all of the issued shares in Outrigger.

Outrigger operates 4 resort properties in Australia:

· Outrigger Surfers Paradise;
· Outrigger Twin Towns Resorts, Coolangatta;
· Outrigger Little Hastings Street Resort & Spa, Noosa; and
· Boathouse Apartments by Outrigger Airlie Beach.

Comprising a total of 984 keys under management, plus freehold title to Managers Lot real estate (comprising restaurants, conference facilities and other common areas), the Outrigger Acquisition presents Mantra Group with a significant investment opportunity.

"The Outrigger Acquisition is a natural fit for Mantra Group, extending the group’s footprint in key leisure destinations," said Mantra Group’s CEO, Mr Bob East. "This acquisition is complementary to our existing portfolio and, together with future pipeline growth initiatives, is expected to supplement Mantra Group’s strong organic growth with incremental earnings. We look forward to working with the owners, guests and team members to make the transition as smooth as possible."

The impact of the Outrigger Acquisition and Placement is expected to be accretive to EPS in FY16. Settlement of the Outrigger Acquisition is expected to complete by June 2015, subject to closing conditions customary for an acquisition of this nature.