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Scandic to exit business in Estonia

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Chain is selling properties in Pärnu and Tallinn

Scandic Hotels is withdrawing from the hotel business in Estonia, the local business daily Äripäev writes. Scandic is “streamlining its business”, the hotel chain explained, even though it continues to have hotels in eight countries including Germany, the Netherlands, Belgium and Poland.
Having already sold the operating rights to the Rannahotell in the Estonian coastal resort of Pärnu, this week Scandic is selling assets and operating rights for the Scandic Palace in Tallinn. According to media reports, the Scandic Palace has not been properly renovated since 1989. A major refit will begin towards the end of 2013.
The Scandic Palace buyer is the real estate company Eften SPV 11, half-owned by real estate fund Eften Kinnisvarafond and Estonia’s 36th richest businessman, Vello Kunman. The purchase price has not been disclosed, but it is estimated to be higher than the Palace’s balance sheet value of €3.1 million. The deal is expected to be closed in April.
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[photo courtesy Scandic Palace Hotel]

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