By Andrew Starke

Listed WA pub company Compass Hotel Group (CHG) is looking to recapitalise after reporting a $99 million loss for the 2009 financial year.

CHG is the largest freehold hotel and tavern business owner and operator in the state, employing over 550 people across 12 venues.

The group is presently suspended from trading on the Australian Stock Exchange (ASX) and has requested that its voluntary suspension continue until December 18, when the company expects to announce a capital raising strategy.

In a statement to the ASX, the group said: “Compass and its advisor BBY Limited are dealing with a short list of interested parties with experience in hospitality to supplement the board and that have the ability to participate in a proposed capital raising for the group to strengthen its financial position and long term strategies.”

Sandalford Wines owner Peter Prendiville and Russell Goodman, whose Absolute Investments has an 8 percent stake in CHG, are both interested, according to the Australian Financial Review.

CHG director, Roland Hill, said the net loss of $99 million over the financial year was “clearly disappointing for all stakeholders notwithstanding the depressed markets in which we operate”.

Trading in the group’s shares was suspended on July 17 after the resignation of its CEO, managing director, chairman and an independent director.

Two members of the board, chairperson Anne Thoume and MD Robert Garton Smith, become ‘interim’ directors of the company in September, with continuing director Hill appointed chairperson.

CHG raised approximately $123 million through its initial float of 123 million shares in January 2008 and used the funds to acquire 14 premises — including 13 pubs — at the peak of the property market.

The Shout Team

The leading online news service for Australia's beer, wine, spirits and hospitality industries.

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