Morgans Hotel Group Co. has entered into a definitive agreement to sell 90% controlling interest in The Light Group to Hakkasan Group for a total enterprise value of US$36 million. The purchase price includes the remaining 10% equity interest in The Light Group.
The deal allows Morgans Hotel Group to retain its leasehold interests in the three Mandalay Bay restaurants that will continue to be managed by The Light Group in addition to an option to buy a minority interest in The Light Group within 18 months post-closing. Morgans Hotel Group will also assume control of food and beverage offerings from The Light Group and its Delano South Beach Hotel.
The transaction is subject to customary closing conditions and is expected to close in January.
“The sale of The Light Group allows us to deliver significant value to stockholders and demonstrates the success of the Special Transaction Committee’s ongoing strategic review process,” said Jason Kalishman, chairman of the board and interim CEO of Morgans Hotel Group. “Not only does the transaction strengthen Morgans Hotel Group’s financial position, but we will also have an enhanced focus on our core assets.”
“The acquisition of a majority stake in The Light Group is another step forward in our ambitious investment strategy to deliver exceptional guest experiences,” said Neil Moffitt, CEO of Hakkasan Group. “Hakkasan Group and The Light Group are highly complementary businesses and we intend to assume and maintain the vast majority of The Light Group’s contracts, licenses and events.”