Mantra Group's shares were the stock market's biggest gainer on Tuesday, surging 9 per cent amid a fresh round of takeover speculation.
Its price was 23.5?? higher at $2.84 on Tuesday afternoon, pitching any offer at more than $1 billion. More than 6 million shares had changed hands.
A range of names, including the Hyatt and InterContinental Hotel groups, have been touted as possible suitors.
Mantra operates the Peppers, Mantra and Breakfree brands, with more than 125 properties across Australia, New Zealand, Bali and Hawaii through its management deal with the Outrigger chain. Mantra also bought the Ala Moana hotel in Honolulu in July 2016 for $US52.5 million.
The group, which listed in October 2014 with a value of about $500 million, issued a statement on Tuesday noting the share price activity but adding that "whilst it is Mantra's policy not to comment on rumour or media speculation, Mantra confirms that it is not in discussions with any potential buyers".
"Mantra is aware of and will update the market in accordance with its continuous disclosure obligations," the statement said.
Hotel experts said the Hyatt and InterContinental groups had, in the past, had mergers and acquisition teams "run the ruler" over the Mantra group, as a means to expand their range of brands across Australia.
Other possible buyers have been named as the Marriott International, but it is still bedding down its $US14 billion merger with the Starwood chain, and Chinese-based hotel operators HNA and the Nanshan Group, which bought a 19.9 per cent stake in Virgin Australia last year from Air New Zealand for about $262 million.
In the half year to December 2016, Mantra delivered total revenue of $356.2 million, representing a 15.9 per cent increase on the same time in 2015.
Its new-build hotel at Sydney Airport is scheduled to join the group in July, with Mantra Macarthur Hotel, Canberra and the first two (of three) towers of Brisbane's luxurious FV by Peppers due to open in August.
The activity comes as the hotel sector enters a new growth phase, particularly in Sydney and Melbourne. Four Points by Sheraton Melbourne Docklands, part of Four Points by Sheraton and Marriott International, has opened to guests, offering the largest inventory of guest rooms and meeting space in the precinct.
