French hotel group Accor announced its acquisition of the Raffles, Fairmont and Swissotel brands for US$2.9 billion in cash and shares, according to its own press release and widespread news reports. The wires are reporting that the acquisition of FRHI (parent of the three brands) will give Accor, already Europe’s largest hotel group, a strengthened presence in North America and Asia. FRHI has 115 properties under management, with 40 more on the way. This is the second major acquisition in the world of hospitality this month, as we reported on here. Accor says the acquisition paves the way for “aggressive worldwide expansion.”
“This is an outstanding opportunity to add three prestigious brands – Fairmont, Raffles and Swissôtel – to our portfolio, and a great step forward for AccorHotels. It offers us robust and global leadership in luxury hotels, a key segment in terms of geographic reach, growth potential and profitability, for long term value creation,” said Sébastien Bazin, Chairman and Chief Executive Officer of AccorHotels.
AccorHotels will pay for the acquisition by issuing 46.7 million new Accor shares and a cash payment of US$840 million (€768 million) to the Qatar Investment Authority and Kingdom Holding Company of Saudi Arabia. Both will become major shareholders, with 10.5% and 5.8% of the share capital respectively.
As usual, this transaction is subject to the regulatory approvals of the antitrust authorities.
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