AccorHotels signed agreements with international investors with a view to sell a majority of capital in AccorInvest, its portfolio of 891 hotels.
Under the terms of the agreements, AccorHotels would initially sell 55% of AccorInvest to Sovereign Funds’ Public Investment Fund and GIC; institutional investors Credit Agricole Assurances, Colony NorthStar and Amundi; and other investors. For AccorHotels, the sale would result in a cash contribution of €4.4 billion (US$5.42 billion).
“Following the separation of AccorInvest into a stand-alone legal entity last summer, we are now gathering a round-table of leading investors, on the basis of a valuation that fully reflects its global leadership and the quality of its assets, while building a long-term relationship between AccorHotels and AccorInvest,” said Sébastien Bazin, chairman and CEO of AccorHotels. “The entry of new shareholders and the deconsolidation of AccorInvest will provide AccorHotels with substantial leeway to enhance our dynamic growth and innovation strategy and create value for shareholders. For its part, AccorInvest will take advantage of its new powerful shareholders’ support, as well as a strengthened financial structure to execute its roadmap and continue to reinforce its portfolio of assets.”
The AccorInvest hotels would be operated by Accor under long-term contracts, namely 50 years (including a 15-year renewal option) for luxury and upscale hotels and 30 years on average (including a 10-year renewal option) for hotels in the midscale and economy segments. The management contract terms that have been negotiated between the parties are in line with market practices.
AccorInvest has nearly 30,000 employees and operations in 27 countries. Most of its hotels are in the economy and midscale segments and are located in Europe. Of its 891, 324 are owned and 567 are operated under fixed or variable-rent leases.
Under the terms of the agreements, the investors made binding undertakings to carry out the transaction and AccorHotels granted them an exclusivity, pending works council consultation. The transaction is also subject to certain antitrust and regulatory approvals. It will be submitted to a shareholders’ meeting of AccorHotels for consultation. It is expected to be finalized in the second quarter of this year.