Speculation about a fresh takeover bid for the Gresham Hotel Group has emerged with reports linking a group of Irish investors to a €103 million bid.

The Sunday Times reported that the consortium approached Red Sea Hotels, which has a 28 per cent stake in the company, earlier this month about a possible bid.

Red Sea Hotels controls the Gresham group, which has hotels in Ireland, the UK and Europe. These include the Gresham in Dublin's O'Connell Street. The report suggested the Red Sea group was considering the approach and a price range of between €1.25 and €1.30 per share has been discussed. This would value the group at between €99 million and €103 million.

Gresham shares closed in Dublin on Friday at 93 cent with the investors offering an attractive premium to Red Sea.

Three Irish investors are said to be involved in the consortium and are being backed by a UK private equity firm with substantial investments in the hotel sector. They are understood to be keen to manage the hotels themselves but could sell-off some of the less profitable ones.

Since Red Sea took control, Gresham has sold off hotels in Galway, Limerick and Killarney.

The Gresham posted a pre-tax loss of €394,000 for the six months to June 30th, when trade was hit by the war in Iraq and concerns over the SARS virus, particularly among US customers.

It did, however, express a desire to double the number of its hotels by taking on new properties in cities where it already had a presence.

The company said it was considering specific opportunities to cluster new hotels around its properties in Brussels, London, Hamburg and Amsterdam.

The battle for control of the company waged by the Israeli-based Red Sea, cost Gresham €1.1 million and resulted in an overhaul of the existing board of directors.