MANDARINE GROUP : Creation of a hotel chain in Paris called "The Fifteen Design"

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Mandarine Group recently acquired a hotel in the 15th arrondissement of Paris, giving substance to the first stage in its strategy of setting up a hotel chain called "THE FIFTEEN DESIGN".

What will "THE FIFTEEN DESIGN" chain be?

From the company's very inception, the Mandarine Group's founders wanted to set up a new design-driven chain of 3- and 4-star boutique hotels with avant-garde design, comfort and technological equipment. With a view to combining this concept with a friendly and personalised atmosphere, Mandarine Group has focused on developments with between 20 and 50 rooms. Units are selected based on strict criteria making it possible to achieve targets and generate a return on equity of over 30% p.a.

Mandarine Group intends to bring 3 to 4 hotels of this type into service each year. The Group has entrusted Pierre Martin-Roux, who has a proven track record in this sector of activity, with the management of this business. Mr Martin-Roux, 49, already has thirty or so hotel developments in Paris to his name, ranging from prospecting through renovation to operation.

Description of the acquisition:

Located in the dynamic 15th arrondissement (close to the Porte de Versailles trade fair centre, the Necker hospital and UNESCO's offices) and a few hundred yards away from the Eiffel tower, this 25-room 2-star hotel will be converted into a 3-star 20-room property. As part of the concept, the hotel will be endowed with attractive living areas, such as a Lounge and sports room.

Mandarine Group has entrusted architect Vincent Bastié, a Paris-based specialist in this type of development for over 20 years, with converting the hotel. He has worked on over 100 hotels and notably "The Five", "l'Hôtel des Académies", and "Le Petit Moulin" in conjunction with fashion designer Christian Lacroix.

Commenting on the plans, Omar Essakalli, Architect and Mandarine Group's Chief Executive Officer, said: "This acquisition is the first building block in the execution of a strategy carefully considered and designed since the Group's creation. I firmly believe in the relevance of this concept, which will help to satisfy the very strong demand for this type of hotel product in Paris. There can be no doubt that this first acquisition will contribute to the creation of value within the Mandarine Group."

Facts and figures about the acquisition:

This development, which was the subject of lengthy negotiations, was acquired on very favourable terms by Mandarine Group:

  • Total investment, including furnishings: ¤1,600,000,
  • Forecast annual sales: ¤900,000,
  • Forecast annual EBITDA: 33%,
  • Forecast annual return on equity: 38%,
  • Forecast opening date: 4th quarter 2008.

About Mandarine Group

The group is simultaneously developing real estate and hotel activities initially in the Moroccan market via a property development business and in European markets. The management team controls all the stages of this business plan: design, implementation, marketing, real estate management and operation of hotels.

Listed on Euronext Paris' Marché Libre, Mandarine Group aims to offer its shareholders a high-performance investment vehicle, which will benefit both from the strong growth of the emerging-market real estate and tourism sectors and from the stability of the European market.

For further information, contact:
Omar ESSAKALLI
Chief Executive Officer
Tel: + 212 22 36 30 36
Tel: + 33 1 42 25 52 40
oessakalli@mandarinegroup.com


MANDARINE GROUP SA

Société anonyme (limited-liability company) governed by a Board of Directors with capital of 44,800,000 euros
Head office: 10 rue Lord Byron  75008 Paris - RCS Paris 722,780,277
Mandarine Group is listed on Euronext Paris' Marché Libre. ISIN code: FR0010439513
Ticker: MLDAR - Warrants: DARBS
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