Whitbread bumps up share buyback and hotel expansion plan

13th Feb 2019 15:36

(Sharecast News) - Premier Inn owner Whitbread will use the proceeds of its sale of Costa Coffee to back an extra £2bn of shares.In an strategy update on Wednesday, the FTSE 100 group said it would return £2.5bn to shareholder from the £3.9bn sale of Costa to Coca Cola, with up to £500m of shares to be bought by the end of April and then would let shareholders vote on a tender offer to repurchase the remaining £2bn.Management also set out a plan to capitalise on what they see as attractive structural growth opportunities for Premier Inn in the UK & German hotel markets.Having ended the past quarter with 74,508 rooms in the UK and one hotel in Germany, Whitbread sees "clear" long-term potential to more than double the size of the UK and international network to more than 170,000 rooms.There are also plans to cut a further £220m of operating-cost and capital-cost savings over the next three years, includes £120m of opex savings and £100m of capex savings, building on the back of £150m delivered over the past three years.