Hotel mergers and acquisitions are likely to accelerate this year on record industry profits and growing private equity fund interest, according to a PricewaterhouseCoopers forecast to be released on Monday.

Hospitality companies could see between seven and 12 takeovers this year, according to a report by PwC hospitality and leisure analyst Bjorn Hanson. The company had forecast five to 11 deals involving both listed and private companies in 2005 and five to 10 in 2004.

The industry actually saw nine M&A transactions in each of the last two years.

An increase in private equity and real estate funds that see hotels as attractive investments could drive the number of deals, Hanson said in an interview.

"There are more dedicated hotel private equity funds than any time in history," Hanson said. He declined to discuss specific companies.

PwC also forecast two to five U.S. initial public offerings in the sector, compared with two to five in 2005 and four to seven stock flotations in 2004. The actual number of IPOs in the last two years was two and four, respectively.

The lodging industry in the United States has been on an upswing, as strong demand and limited growth in supply push up occupancy levels and allow hotels to raise room rates.

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