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Zeus Private Equity has begun a £50 million-plus spending spree with the acquisition of the Belfry House Hotel at Handforth in Cheshire for an undisclosed amount.

The transaction marks the beginning of Zeus’ buy-and-build hotel strategy that is focused on completing three more hotel deals this year and ultimately building up a portfolio of up to ten hotels with the venture capital it has at its disposal.

With its war chest, the buy-out firm plans to snap up lacklustre three-star hotels and convert them into four-star accommodation to meet growth in the sector. It is currently eyeing targets in the north and Midlands.

Griffiths & Armour Insurance Brokers was appointed by the buy-out house to conduct insurance and risk management due diligence. Tony O’Gara, director, led the team which benefited from the risk management expertise of Cath Swindells, associate director.

Griffiths & Armour act on behalf of Zeus in connection with its acquisitions and has also been appointed as insurance broker to Hallmark Hotels Group.

Corporate manager Steve Sherratt led a team at Allied Irish Bank’s (AIB) Manchester office who provided senior debt to Zeus Private Equity. Sherratt commented: “AIB has a long-standing track record of supporting hotel transactions and whilst the quality and location of the hotel are critical success factors, we recognise that the most important factor is the strength and experience of management. The team that has been put together in this instance provides all the right ingredients for a successful execution of strategy.”

The team includes Arnold Schnegg of Q Hotels, as chief executive, James Hawksworth of Paramount, as finance director, and former Metropole Hotels chief Jonathan Lea as chairman.

Sherratt continued: “We were introduced to the parties by Chris Eddlestone of law firm Halliwells due to our experience in the hotels sector. We were supported by Pannone & Partners on the legal due diligence and Edward Symmons on the valuation due diligence.”

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