SCOTTISH hotels company North British Trust Group, a favourite of elderly coach holidaymakers, is reinventing itself as an "adventure tourism" provider by selling the vast bulk of its portfolio to English player Swallow in a pounds -75m deal.

The Edinburgh company, which is majority-owned by the Crerar family, will sell 20 of its properties and retain only four "key destination hotels" which it believes fit with its new strategy. About 1200 of its employees will switch to Kent-based Swallow Hotels and Inns.

The Scottish group, which trades as British Trust Hotels and Crerar Hotels, also plans to build an 80-bedroom, four-star property in Glencoe with leisure, spa and conference facilities. The plans incorporate a retail site focusing on "highquality Scottish produce".

The four hotels being retained are the Isle of Mull at Craignure, the Ben Wyvis at Strathpeffer, the Oban Bay and the Loch Fyne at Inveraray.

North British also highlighted a "further four land development sites" - and declared its intention to return to the size it is now in its new identity of adventure tourism player.

Paddy Crerar, who will move from his current managing director role at North British to a part-time position on the board and become full-time Scottish operations director for Swallow, said three of these sites were in Scotland and one not far across the border in England. He said one Scottish site was in the Highlands, and another in Perthshire, but declined to divulge the location of the third.

Crerar also declined to reveal the scale of any windfalls which might be reaped from the sale by his family and other private individuals, institutions and trusts among the 120-strong shareholder base in North British.

Asked how much might go to his family and how much might be reinvested in the business, Crerar replied: "There is a fair amount of investment to be done. We have to consider all of our shareholders. It would be unfair to the shareholders to speak to you before I have spoken to them."

Crerar, who is 36, declined to reveal the size of the Swallow deal but it is believed to be about pounds -75m. The hotels being sold are in Thurso, Wick, Ullapool, Skye, Fort William, Inverness, Grantown-on-Spey, Ballater, Pitlochry, Oban, Arrochar, Callander, Edinburgh, Gretna, Harrogate, Scarborough and Nottinghamshire.

North British's hotels business makes annual earnings of about pounds -8m before interest, tax, depreciation and amortisation, and Crerar said it was also "very profitable" at the pre-tax level.

He emphasised it was good performance rather than any difficulties which had enabled the decision to sell to Swallow, which is also privately owned and will have about 60 Scottish hotels after the deal.

Crerar said: "We have had sustained profit growth for the past four years from an already high base. We have been achieving targets and beating them. It has been a good run.

"This sale is probably a result of that, more than anything else. We had a strategic plan which, in terms of profit levels, we have already achieved ahead of timescale. That made it an easier decision to advance this whole train of thought."

Crerar said of the switch to adventure tourism: "It is more about the type of holidaymaker we believe is going to come to Scotland in years to come. The traditional perception is a holiday in Scotland is sedentary.

You can look out the window at a beautiful view. You can't necessarily take part in that."

Highlighting an erroneous perception that a visitor could not find an easy way up the mountain or go out in the water to touch a basking shark, Crerar added: "What we want to do is make our hotels more resortbased, so people can become more involved in their environment, so they can touch it physically as well as spiritually."

In the early 1990s, 100% of North British's hotels business came from coach holidays which Crerar said "was very much the grey market". He said coach holidays now accounted for just 40%, and even this was split between traditional packages and Cosmos tours where the average age was 35.

About 30% of North British's hotels business is from overseas.

The Scottish group said yesterday it had agreed in principle to sell its own North British Holidays coach touring arm to a Scottish competitor.

Paddy Crerar's father, Bill, a hotel architect, chairs North British. John Wilson, group operations director, will oversee the day-to-day running of the reduced hotels business.

HOTELS SWALLOWED UP

Arrochar Arrochar

Caledonian Ullapool

Columba Inverness

Craiglynne G'town on Spey

Dreadnought Callander

Dunollie Isle of Skye

Fishers Pitlochry

Glenfield Ullapool

Greens Edinburgh

Gretna Hall Gretna Green

Highland Fort William

Kings Arms Isle of Skye

Loirston Ballater

Norseman Wick

Queens Oban

Regent Oban

Royal Thurso

St Nicholas Scarborough

The Yorkshire Harrogate

Ye Olde Bell Retford