Fladgate Fielder advised Euro & UK Property and the Orb Estates group on the £600m acquisition of 37 Thistle Hotels and the companies that own them, effectively giving the West End firm a new client. Thistle Hotels, advised by David Pudge at Clifford Chance, sold a 37 hotel-package that it will continue to operate under a 30-year management contract. Thistle will be left with assets worth £1bn. The acquisition was funded by Morgan Stanley Dean Witter Bank and Morgan Stanley Dean Witter Principal Funding, advised by Mark Menhennet at Denton Wilde Sapte. Fladgate head of corporate Nicholas Greenstone, who led for the purchaser, said: “We’ve acquired a major operating client with almost 4,000 employees. There will be lots of ongoing title work, building contracts work and planning permission work.” The deal is the largest-valued transaction Fladgate has advised on to date. The structure marks a groundbreaking development in the UK hotels sector, with US investment bank Morgan Stanley refinancing the loan to Orb by securitising the hotels’ revenues. “The finance was secured on the basis that Thistle was guaranteeing a certain level of income per annum, which would be more than sufficient to pay the debt on the Morgan Stanley loan, which enabled Morgan Stanley to securitise the loan,” said Greenstone. “That hasn’t been done in this sector before. “Orb came up with the basic structure and we added the various bits and pieces to make it work properly.” Fladgate has acted as main adviser to Orb, owned by Jersey company Euro & UK Property, since it was set up in the mid-1990s to build up UK assets. The Fladgate team included corporate partners Anthony Vaughan and Rupert Cronnell, and property partners Antonia Brandes, Ian Narbeth and Robert Muir.