Compass Group has sold Posthouse, consisting of 79 hotels, to Bass for £810m, in cash. The acquisition by Bass is in line with its objective of building its mid-scale brand distribution in Western Europe; in particular the development of the Holiday Inn brand with an injection of £75m over the next three years. All the Posthouse hotels are situated in the UK, except one in Ireland. Tim clarke, chief exeuctive, is delighted with the deal: This transaction continues the repositioning of Bass and replaces half the profits of Bass Brewers, that was sold for £2.3bn last year, with profits with significatn growth prospects. Compass Group is also poised to announce the sale of its Heritage chain of 47 hotels to MacDonald Hotels for a figure reported to be around £240m. A spokesman for Compass says although the group has not yet commented on the auction, Heritage is next on the block; a deal is likely to announced this week. If the deal goes ahead it will triple the size of the MacDonald business, which has been backed by the Bank of Scotland. The final part of the disposal of the various groups would be to sell the upmarket string of Le Meridien hotels, but Compass have confirmed that a decision on this is inevitably likely to take longer. Compass has already sold its Signature hotels in London, including the Regents Palace and Strand Palace hotels.