Brierley Bids $41 Million for Hotel Operator

Times Staff Writer

New Zealand financier Ronald A. Brierley will launch a friendly $41-million takeover of Associated Hosts, a Beverly Hills operator of restaurants and hotels, it was announced Thursday.

Associated Hosts Chairman and Chief Executive Joseph Bulasky has agreed to sell his 35% stake in the company for $11 a share to Industrial Equity (Pacific) Ltd., Brierley’s Hong Kong-based investment arm, an Associated Hosts spokesman said. Part of the agreement calls for IEP to make a cash tender offer for the rest of the company at the same price.

IEP already owns 19% of Associated Hosts’ 4.63 million shares outstanding. It began buying the company’s stock in 1986.

Associated Hosts operates 59 restaurants in 25 states under such names as the Bombay Bicycle Club, Smuggler’s Inn and Julie’s Place. The company owns the 150-room Beverly Hillcrest Hotel in Los Angeles, and manages the 75-room Westlake Inn Motor Hotel in Westlake Village and the Beverly Crest Hotel in Beverly Hills.


May Seek Partner

Brierley, through his various investment companies, is known for his eclectic collection of corporate holdings, which include real estate development, oil and gas, retailing, wheelchair manufacturing and a cemetery. Brierley’s companies can be very active investors interested in influencing management practices but they also can be nearly invisible.

“Our business is investing in and buying companies,” said Al Boyer, executive vice president for IEP’s North American operations. “Our primary interest has always been more in the hotel than in the restaurant business.”

Boyer said IEP, which owns hotels in Australia and New Zealand, may seek a partner to run the restaurants or could consider a sale of those assets.

The Associated Hosts spokesman said he did not know if current management will remain with the company after the sale. Boyer said IEP has not yet discussed whether management will stay.

Associated Hosts had a money-losing year in fiscal 1986, but bounced back after writing down 17 unprofitable restaurants that it planned to sell. As of earlier this year, nine of the restaurants had been sold.

For the nine months ended June 30, Associated Hosts posted net income of $1.7 million on revenue of $52.1 million. In the same period last year, the company recorded net income of $1.5 million on revenue of $53.3 million.