Co Clare-headquartered Great National Hotels and Resorts is to merge with British rival The Hotel Partnership. 

Great National Hotels is made up of 64 hotels - some of which it co-owns or operates under a long-term lease, but most of which are independent firms that it provides services to. The merger will create a group of 135 hotels across Ireland and the UK, with more than 8,000 beds.

According to David Collins, COO of Great National Hotels and Resorts, the deal offered the company a chance to grow their presence in the British market. "This presents us with an opportunity to consolidate our foothold within the UK market, which is particularly important with Brexit coming down the tracks," he said. "They've got a very experienced senior management team, it's a mature brand, they've got a strong regional footprint, particularly with in the four-star market."

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Mr Collins also said a British move made sense as is was the company's closest market and one that it was already familiar with. However the threat of Brexit - and particularly the level of uncertainty around the EU/UK relationship after Britain leaves - does pose challenges to the tourism sector on both sides of the Irish Sea.

For some it would raise questions as to the value of an Irish firm further embedding itself in Britain, but Mr Collins sees great potential within Britain, whatever the outcome. "Tourism within the UK is forecast to double in size by 2025 to approximately £260 billion, so it's a huge opportunity for us," he said. "We started back in 2010 at the last recession and back then things were equally uncertain. This is what we do as a company - we effectively bring certainty to hotel businesses, so we're quite used to working under these circumstances."

As with most mergers, part of the attraction is also the efficiencies and savings that can be achieved by bringing two similar businesses under one roof. However Mr Collins said this will not include job losses, adding that the firm hopes to be in a position to actually increase employee numbers in the not-too-distant future.

While today's announcement shows a degree of confidence within the hotel industry there are a range of challenges facing it too, not least the threat of the special 9% VAT rate being revoked in the upcoming Budget. Unsurprisingly, Mr Collins would like to see it retained. "Maybe what we're seeing is kite-flying before the Budget, maybe not," he said. "The 9% rate has not single-handedly saved the tourism industry but it is a key value driver and in my view, if it ain't broke, don't fix it."

Mr Collins said that the industry is facing significant cost pressures from the shift in the rate of sterling, so a rise in VAT would risk making firms even less competitive. However hotel prices are rising, profits are growing at many firms and tourism numbers are at record highs - all of which is adding to calls for an end to the special treatment. But Mr Collins argued that tourism is a massive, regional industry that needs support - and says that the Government would be better trying to regulate the likes of AirBnB if it wanted to raise more revenue for other areas.  

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