Ryan Hotels received shareholder approval yesterday to sell the Royal Marine Hotel in Dun Laoghaire for £17.5 million (€22 million) and lease it back for two and a half years.

At an extraordinary general meeting, the Ryan chairman, Mr Sean Henneberry, defended the company's decision to sell the property and the price it had negotiated.

"It has been sold for nearly 40 times pre-tax profits. For shareholders looking for a return, that is quite significant and quite unique," he said.

Speaking after the meeting, chief executive Mr Patrick Coyle said the Royal Marine was not earning an appropriate return and did not fit the core Ryan strategy of basing hotels in the corporate/city-break sector in city centre locations.

However, Mr Coyle said the group had no plans to sell off the Killarney Ryan and Galway Ryan hotels, which operated in the family leisure-break market.

Part of the proceeds of the sale of the Royal Marine will be used to repay debt, reducing the company's gearing to 30 per cent, with the remainder earmarked for investment, he said.

At the company's a.g.m., held earlier yesterday, shareholders agreed to change the name of the plc to Gresham Hotel Group plc as part of a rebranding strategy.

The company is investing £5.2 million on the rebranding exercise, expected to be completed by the end of this financial year. Between £500,000 and £800,000 is being spent on training, brochures, stationery and communications. The remainder will be spent on product improvement, with renovations to a number of hotels, including the Gresham in Dublin.

Managing and leasing hotels is an option the company is pursuing, according to Mr Coyle. He said the effects of the foot-and-mouth outbreak were particularly felt in its west coast hotels. However, he said he could not say how the foot-and-mouth outbreak would affect the group's profits.

"At this point in time, I'm not going to get into a forecasting scenario but we're comfortable at the moment with our forecasts," Mr Coyle said.