Consolidation in Portuguese Tourism sector
: study of an acquisition of Penina Golf & Resort by Palmares Resort : mergers & acquisitions

  • Pedro Bispo (Student)

Student thesis: Master's Thesis


Current crisis, faced by Portugal, affected all economy leading to new forecasts for growth, cost of money, and total stagnation of real estate. The credit crunch and the increasing on interests due to liquidity availability enhanced the difficulties of many families and companies, which in turn, fed a full-scale economic problem. Despite the negative outlook, Tourism is probably one of the sectors that can support the turnaround needed, and imposed by external entities in the scope of a financial support program for Portugal, which as a country, presents unique geographical and weather conditions. Hotel sector in Portugal, mainly due to excessive leverage, families’ ownership and too much fragmentation is starting a needed process of concentration and professionalization, which means that it is expected several M&A actions in the forthcoming years. Considering this context, this thesis makes an attempt to anticipate this trend by providing a possible outcome to a hypothesized merger of Penina Golf & Resort and Palmares Resort through the acquisition of Sociedade Turística Penina, S.A by Palmares Lagos, S.A., that together have the two most distinctive golf courses with a highlighted position in Algarve’s Western tourism. This study proposes an analysis of both companies’ financial history in order to forecast future performance and, consequently, define their values. By using valuation techniques supported by economic and financial theory, it is provided the state of the art’s academic knowledge which is, at the same time, recognized by the top practitioners working in the areas of corporate finance and investment analysis. Through the combination of a deep Industry and company analysis with complementary equity valuation tools, the outcome of this thesis predicts a concentration trend for this sector, either performed by current players or outsiders as private equities or venture capitalists, which under the right circumstances (depending on location, target segments, distribution channels and complementary services and products) could originate enormous benefits. In this particular case study the value of synergies reach 22,1 million euros, which represents 32,8% from the valuation of Palmares resort standalone operation.
Date of Award2012
Original languageEnglish
Awarding Institution
  • Universidade Católica Portuguesa
SupervisorPeter Iordanov Tsvetkov (Supervisor)


  • Mestrado em Finanças

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