Sol Meliá and the Madrid-based TRYP hotel chain have signed an agreement by which the former will acquire all of the shares in TRYP S.A. for a total of 60,000 million pesetas. The operation will consolidate Sol Meliá`s position as the leading Spanish hotel company, with 201 hotels nation-wide, and significantly increase its portfolio and leadership in the city hotel market.
According to the agreement signed by Sol Meliá`s Vice-Chairman, Sebastián Escarrer, the Chairman of TRYP, Antonio Briones and the Chief Executive Officer of TRYP, Rufino Calero, a payment will be made of 27,000 million pesetas and 13,222,266 Sol Meliá shares valued at 15 euros per share. TRYP shareholders will thus become owners of approximately 7.2% of the hotel chain`s capital and Rufino Calero will join Sol Meliá`s Board of Directors.
This operation has also included the purchase by Sol Meliá of the two flagship properties the Fénix Hotel in Madrid and the Colon Hotel in Seville. These are being purchased for a total of 12,500 million pesetas.
The merger of the Sol Meliá and TRYP hotel groups is expected to generate significant operational, administrative, fiscal and legal synergies. It is estimated that the cost savings created by the merger of the two companies will exceed 1,000 million pesetas per year.
The operation will be finalised on approval by the Sol Meliá Shareholders` General Meeting which will take place at the end of September. The Meeting must also approve the capital increase and the alterations to the Board of Directors required under the terms of the agreement. Following the capital increase, the Escarrer family will hold a stake of approximately 61% while former TRYP shareholders will own 7.2%, making them the second largest shareholder of Sol Meliá.
Both companies have been assisted in the operation by external advisors, AB Asesores Morgan Stanley and Ur’a & Menéndez on behalf of TRYP, and UBS Warburg and Cuatrecasas on behalf of Sol Meliá.
The acquisition involves the addition of 60 hotels with more than 9,700 rooms and another 15 hotel development projects already signed by TRYP to the 275 hotels which Sol Meliá already operates in 29 countries. The new hotels will strengthen Sol Meliá`s global diversification strategy, resulting in a mix of 48% of resort hotels and 52% of hotels located in the world`s major cities.