The Urban Development Corporation (UDC) has decided to sell its majority 60 per cent stake in Pegasus Hotel Company, operator of The Jamaica Pegasus.

The National Hotels and Properties Limited, a wholly owned subsidiary of the UDC, holds 71.8 million shares in the popular New Kingston hotel.

Those shares, based on current market prices, are valued at $1.4 billion on the Jamaica Stock Exchange.

Hotel profitable

The hotel is profitable, making $39 million off sales of $676 million at year end, March 2008.

Within this financial year, Pegasus reported net profit of $40 million in its first six months to September 30. Sales were just under $400 million.

Yesterday, Pegasus hotel Chairman, John Issa, said it was up to the UDC to disclose whether buyers were lined up for the property.

But Issa said the pending sale was not surprising, as the Bruce Golding-led administration had indicated it would be putting the hotel on the market.

Total assets

Pegasus, according to unaudited financial statements to September 30, had fixed assets valued at $4.3 billion on its balance sheet and total assets of close to $4.5 billion.

The hotel has, for years, been a sought-after asset but none of the proposals, it seemed, was sweet enough for the UDC to sell.

Attempts to reach the new UDC chairman, Wayne Chen, were unsuccessful.

The share divestment was disclosed on Thursday in a stock market filing, a week after Prime Minister Golding said in Parliament that the UDC would be disposing of some of its holdings.

The Pegasus hotel is capitalised at $2.4 billion. Any investor buying up over 50 per cent of the shares will, under market rules, be required to make a similar offer to minority shareholders at a price that is not lower than what it paid to acquire the shares.

Pegasus shares last traded at $20.

dionne.rose@gleanerjm.com