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1. General
Danubius Hotel and Spa Rt. ("Danubius" or "the Company") is a company limited by shares incorporated under the laws of the Republic of Hungary. The Company and its subsidiaries (the "Group") provide hospitality services in Hungary and the Czech Republic, with an emphasis on 4- and 5-star spa and city hotels.
Danubius operated as a self-administered State enterprise (Danubius Hotel and Spa Company) controlled by an Enterprise Council until July 31, 1991. Effective July 31, 1991, Danubius was transformed into a company limited by shares and ownership was passed to the State Property Agency ("ÁPV Rt."). In November 1992, a portion of Danubius’ outstanding shares was publicly sold and such shares were listed for trading on the Budapest Stock Exchange.
Danubius acquired from ÁPV Rt. 85% of the shares of Hungária Szálloda Rt. ("Hungar Hotels"), a company incorporated under the laws of Hungary and operating in the hotel industry in January 1997. Danubius acquired a further 14.78% of the shares from the employee consortium in September 1997. As to negative goodwill (see Note 11).
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Danubius group was reorganised on January 1, 1999 (see Note 2).
The Company acquired 100% shares in Gama 45 s.r.o. (which owns a hotel in Marienbad, Czech Republic) from Ceskoslovenská Obchodní Banka on December 14, 1999 (see Note 26).
In April 2000 Danubius acquired a 64.98% stake in Lecebne Lázné a.s., a Czech hotel company having operations in Marienbad. Subsequently Danubius has acquired an additional 25.08% stake (in several installments). As at 31 December, 2000 Danubius owned a 90.06% interest in Lecebne Lázné a.s. (see Note 27).
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