AccorHotels buys Fairmont-Raffles for US$2.9bn

The Raffles Hotel Singapore will now joins AccorHotels' portfolio
The Raffles Hotel Singapore will now joins AccorHotels’ portfolio

AccorHotels has agreed to acquire FRHI, the company that operates Fairmont, Raffles and Swissotel.

Under the terms of the deal, AccorHotels will issue 46.7 million new shares and pay US$840 million in cash to the Qatar Investment Authority (QIA) and Saudi Arabia’s Kingdom Holding Company (KHC), valuing FRHI at US$2.9 billion.

The acquisition will add 155 hotels and resorts to AccorHotels’ portfolio, including famous properties like The Raffles Hotel Singapore, The Savoy in London, The Plaza in New York and the Fairmont Peace Hotel in Shanghai.

“This is an outstanding opportunity to add three prestigious brands – Fairmont, Raffles and Swissôtel – to our portfolio, and a great step forward for AccorHotels,” said Sébastien Bazin, chairman & CEO of 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.

“This major acquisition demonstrates the group’s agility in a fast-changing industry and will allow us to more effectively support our guests, clients and hotel owners. Through it, we are positioning ourselves as a key player in the current industry consolidation process while maintaining substantial leeway to implement our transformation plan,” he added.

FRHI’s portfolio covers 34 countries across five continents, and comprises more than 56,000 rooms. The company also employs more than 45,000 people.

AccorHotels said the acquisition was made to improve the balance of its portfolio and broaden its geographic footprint in the luxury segment. The company’s existing luxury brands include Sofitel, MGallery and Pullman, but it has traditionally been stronger in the lower tiers, with its large collections of economy ibis hotels and midscale Novotels.

This acquisition also continues the recent consolidation of the hotel industry; China’s Jin Jiang International has already acquired Louvre and Plateno hotels this year, making it one of the biggest global hotel groups, and last month Marriott announced plans to buy Starwood for US$12.2bn.

In 2011, AccorHotels acquired Australia’s Mirvac in a US$254m deal.

You might also like

Comments are closed.

Join over 180,000 travel agents, professionals and executives subscribed to our daily newsletter.
You can unsubscribe at any time
Subscribe to our newsletter
Sign up here to get the latest news, updates and special offers delivered directly to your inbox.
You can unsubscribe at any time
Do NOT follow this link or you will be banned from the site!