Whitbread has bought 21 hotels from Mitchells & Butlers in a swap for 44 Whitbread pub restaurants.
The deal has been made on the basis of equivalent EBITDA of around £9m from the hotels and pub restaurants and an estimated value of £78m for the assets to be exchanged.
The hotels which comprise 1245 rooms and are currently operating as Express by Holiday Inn hotels.
Whitbread will rebrand the portfolio to its Premier Inn format and the acquisition will take its number of UK rooms to more than 38,000 across 550 hotels.
Planning consent has been granted to extend five of the 21 hotels, adding around 200 new rooms.
Whitbread has identified additional opportunities to extend the new hotels to over 1500 rooms, subject to planning approvals.
Alan Parker, Whitbread chief executive officer, said: 'Acquiring this well located, modern hotel estate will enable us to re-brand quickly, drive occupancy, increase profits and extend the number of rooms at these hotels by at least 20%.'
The 44 Whitbread pub restaurants to bought by Mitchells & Butlers are on sites where development with a Premier Inn has not been possible due to planning constraints. Whitbread will continue with plans to develop a Premier Inn on its remaining 51 pub restaurant sites where there is currently not yet a hotel alongside.