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Wednesday, September 08, 2010

Ethiopian Investor Buys Ghion Hotel




USD 510 mln to be spent for construction of two new hotels

By Meirafe Berhane

The Privatization and Public Enterprises Supervising Agency (PPESA) reached a decision for a joint ownership of the 59-year old Ghion Hotel yesterday with an Ethiopian investor, Aklileberhan Mekonnen Haileselassie.

The bid process, which took about two years to complete, attracted investors from Abu Dhabi, Egypt, Kuwait, Nigeria, Saudi Arabia, Israel and Germany. The Agency finally decided on a joint partnership with Aklileberhan. The takeover includes the construction of two new four-and five-star hotels on the premises of the current Ghion Hotel worth USD 510 million

Aklileberhan will have an 80 percent stake while the remaining 20 percent (USD 100 million) will remain with the Agency. The construction of the hotel is expected to be finalized in three years and four months period.

The new establishment, which will be named Grand Ghion Hotel, will feature one new four-star hotel on the site where the current swimming pool is found and will be completed within a period of a year and four months. Another five-star hotel will be constructed after the current Ghion Hotel building is demolished.
“We won the bid because of the design we presented, the amount of money we offered and our great strategy of not to fire the existing workers of the hotel,” Aklileberhan said. “Instead of firing the workers, we believe that it will be better to train them and build their capacity.”

The new design will include a helipad and presidential suites. According to Aklileberhan, they have negotiated with Intercontinental Hotels and Resorts to take over the management of the upcoming Grand Ghion Hotel.

Next week the new Grand Ghion Hotel will be established and the board will commence its duties.

“In terms of design and size, the hotel will be one-of-a-kind and the best in Africa; its presidential suites can accommodate leaders of Africa for African Union summit,” the representative of the investor and chairperson of the board, Costantinos Berhe (PhD), said.

As per the request of the Agency, the investor’s financial background and capacity was attached and sent to the Agency and the Ministry of Foreign Affairs, for verification.

“My deepest desire is to support my country with the expansion of the hotel industry and other activities,” Aklileberhan said. He is also planning to build hotels in Lalibela in the Amhara Regional State and Axum in the Tigray Regional State. Building a hospital in Jimma in the Oromia Regional State is also one of the investor’s plans. Moreover, he is also planning to contribute USD 20 million for the establishment of Axum’s museum through the Ethiopian Orthodox Church and finance the construction of a new secondary school on the premises of St Trinity‘s Church.

Aklileberhan, along with his wife and children, owns twelve investment companies, two in Germany and eight in the UK. His headquarters are found in Switzerland.

Ghion Hotels Enterprise was established by the government in 1951 and used to operate a chain of 11 hotels, which were all found in north Ethiopia, except National Hotel, which was sold to the Ethiopian Athletics Federation a few months ago. Roha Hotel, one of the hotels administered by Ghion Hotel, was transferred to Ayat Real Estate S.C. after the latter won a bid. Despite operating old hotels with rundown facilities in many of its properties, including the one in Addis, the enterprise registered an after tax profit of 10.6 million birr in 2004. The hotel is well known for its tastefully furnished rooms, enchanting gardens with their exotic plants and flowers, and thermally heated bathing and swimming pools.

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