Irish hotels are in demand, buoyed by the strength of the economy and booming tourist numbers, so it seems like a good idea for the Government to look at selling off Great Southern Hotels. After all, 10 years ago, the then government looked at a sale only to engage in a cosmetic change of ownership by transferring Great Southern from Cert to Aer Rianta.

Great Southern has been a handy little earner for Aer Rianta, but there really is no logic in an airport authority owning hotels - far easier for the likes of Aer Rianta to lease space at its airports to hotel operators (like Forte in the case of Dublin Airport) than to set up their own operations.

Aer Rianta chairman, Noel Hanlon, says he knows nothing about any sale of Great Southern, but many believe that the Aer Rianta strategic review will recommend a sale of the hotel chain - the only question being whether it should be floated on the stock market or sold to a trade buyer.

Great Southern is a tidy little operator and is likely to boost last year's pretax profits from £2.9 million to around £3.5 million, with the new hotel at Dublin Airport kicking into profits for the first time. It is still small, even smaller in terms of profits than Ryan Hotels, which with profits last year of £5 million, struggles to trade on the market at just nine times earnings and a market capitalisation of £45 million.

On the basis of the Ryan figures, a suggested flotation valuation of £50 million for Great Southern looks a bit optimistic.

Another route is a sale to a British hotel operator like Stakis, which has made no secret of its wish to expand from its current one hotel in Dublin.

Great Southern's eight hotels are nicely situated either at airports or in major tourist centres like Galway and Kerry, where they could benefit hugely from the centralised reservations that a major hotel operator could bring. If a decision is taken to sell Great Southern separately from Aer Rianta, there are likely to be plenty of interested parties.