The proposed acquisition of the Doyle Hotel Group by Jurys is a classic predatory move, with the number one player effectively taking out its nearest rival. The venture is initially being seen as broadly positive for both groups and the hotel industry generally.

If the current negotiations are successfully concluded, they will create a new dominant player - the Jurys Doyle Hotel Group - consisting of 28 hotels and inns with a presence in the Irish, British and US markets.

While details of the price Jurys has offered to pay the Doyle family for the group have not been disclosed, it is believed to be up to £200 million, putting a potential market value of more than £400 million on the enlarged entity.

The Jurys Doyle Hotel Group will be of similar size to major British hotel chains such as Millennium and Copthorne and the Stakis groups, and will leave its nearest competitors in the Irish market - Ryan and the Great Southern group - trailing far behind.

Jurys is offering to pay the Doyle family a mixture of shares and cash for its 11 hotels. At that price, the deal does not stretch its financial resources and some analysts believe the price is not overly high.

The group will have a substantial war chest left and is expected to continue to seek sites in Britain for future development.

Jurys is buying seven Irish hotels of three, four and five-star standard in prime locations in and around Dublin - including the Doyle flagship Berkeley Court, the Westbury and the Burlington. Under the deal it will also acquire the four-star Doyle Clifton Ford Hotel in London's West End and three hotels in Washington DC of three and four-star rating.

To the end of last January, the Doyle group reported turnover of £62 million and is estimated to have earned pre-tax profits of around £10.5 million. Jurys will be looking for the acquisition to be strongly earnings enhancing for the enlarged group. Much will depend on the actual price paid, the cost of any bank borrowings and the scale of the cost savings a link-up of this scale can yield. It will also depend on the price at which the Jurys shares are issued to the Doyle family members.

Mrs Margaret Doyle, her son David, and her three daughters, Mrs Bernie Gallagher, Mrs Ann Roche and Mrs Eileen Monahan, each has an equal share in the hotel group, valuing their individual stakes at up to £40 million.

Mr David Doyle is expected to opt to take the bulk of the payment for his shareholding in cash while the rest of the family will take Jurys shares and some cash. Under the terms currently being discussed, Mrs Doyle and her three daughters will end up with the single largest block of shares in the Jurys Doyle Hotel Group, holding just under 30 per cent of the entire share capital.

For the Doyle family the deal will help it resolve the difficulties posed by Mr Doyle's wish to exit the business. It also allows those family members who wish to continue working within the hotel group, founded by Mr PV Doyle, to retain an interest in the business.

A flotation on the Irish stock market as a possible structure to facilitate Mr Doyle's exit was also considered.

From a marketing perspective, the deal is highly attractive for the international travel trade, offering a comprehensive range of hotels within a single group. It should also give rise to a more efficient booking system. Jurys has already indicated that the Jurys and Doyle hotels will continue to operate as at present. Their two flagship hotels, the Berkeley Court and Jurys Ballsbridge, operate back to back in Dublin and have done so very successfully for years.

When the deal is bedded down, some analysts believe Jurys may look to dispose of some of the out-of-town hotels and may also look to merge Jurys's five-star Towers hotel with the Berkeley Court.

On the downside, it could be argued that Jurys has left the move a little late, buying in at the top end of the tourism cycle. With booming visitor numbers to the Republic over the past couple of years, occupancy rates have been at an all-time high despite the rapid growth in hotel rooms available, particularly in Dublin.