Woolies buys Magnums Hotel for $8 million

Whitsundays Online

Woolworths (Australian Leisure and Hospitality - ALH) has continued its hotel buying spree by purchasing the well known Magnums Backpacker Hotel (Map) from National Leisure and Gaming (NLG).

NLG CEO Andrew Jolliffe described the sales as positive outcomes in an unpredictable market, with the troubled hotel group making a tidy profit after effectively paying nothing for its Airlie leasehold and $3.5m for the Bribie Island hotel business.

NLG earlier owned the freehold of the Airlie pub, which it onsold to the private Aussie Leisure Group, but retained the leasehold. It's understood to have received about $8m from the latest sales.

Liquor expansion has been a crucial source of growth for Coles and Woolworths. Most of Woolies' market share gains have been in liquor, not in its supermarkets, in the past three years.

Coles and Woolies have made liquor their focus, increasing their combined market share from 32 per cent to 52 per cent in the past four years, according to Citi research.

Woolworths owns 279 pubs through the ALH venture. It also has 1138 bottleshops across the country, including 100 Dan Murphy stores, 610 BWS stores and 428 Woolworths/Safeway liquor stores.

More on this story at The Brisbane Times and The Australian.
Map by Channel Whitsunday
Map