Following the approval of shareholders at the general shareholders meeting today, AccorHotels Group has completed the acquisition of FRHI Hotels & Resorts.
The deal sees three prestigious luxury hotel brands - Fairmont, Raffles and Swissôtel – move into the AccorHotels stable.
This addition of three remarkable brands positions AccorHotels as a leading player in the global luxury hotel market, increases long term growth potential and profitability, and significantly expands the company’s footprint in North America, the world’s largest and most influential consumer market, the company said in a statement.
“Today is a great day for our group.
“The acquisition of these three emblematic luxury hotel brands is a historical milestone for AccorHotels.
“It will open up amazing growth prospects, lift our international presence to unprecedented heights, and build value over the long term,” said Sébastien Bazin, chairman, AccorHotels.
Joining AccorHotels’ global network is a portfolio of globally admired brands, which includes management of many of the world’s most iconic and historic hotels located in key strategic cities around the world.
These include The Savoy in London, Raffles Singapore, Fairmont San Francisco, New York’s The Plaza, Fairmont Le Château Frontenac in Quebec City, and Le Royal Monceau Raffles Paris.
“We remain committed to providing guests with unparalleled service, while also keeping the ambition to deliver exceptional return on investment for our shareholders and hotel owners,” added Bazin.
“By leveraging the operational synergies between FRHI and AccorHotels, we are well-positioned to accelerate the growth of our luxury brands and offer guests even more exciting hotel choices and destinations to explore.”
Chris Cahill has been appointed as the group’s chief executive of luxury brands in support of the acquisition.
In this newly created role, Cahill, who will also become a member of AccorHotels’ executive committee, will lead the FRHI integration process and be responsible for the strategy and global operations of AccorHotels Luxury Brands.
This new structure will include Raffles, Fairmont, Sofitel Legend, So Sofitel, Sofitel, MGallery by Sofitel, Pullman and Swissôtel.
He is an experienced hotelier who has led several successful integrations, is familiar with multi-brand management and brings an extensive background in luxury operations, sales and marketing.
With more than 30 years of hospitality industry experience, including 19 years working with FRHI and its predecessor companies, Cahill is ideally positioned to lead the integration of the Fairmont, Raffles and Swissôtel brands into the AccorHotels portfolio, and will ensure AccorHotels’ luxury brands grow and prosper.
Following the approval of shareholders at the meeting, the transaction with Qatar Investment Authority and Kingdom Holding Company of Saudi Arabia provided $840 million cash payment and the issuance of 46.7 million AccorHotels shares in consideration for the contributed FRHI shares.
The transaction gives QIA and KHC respective stakes of 10.4 per cent and 5.8 per cent in Accor’s share capital.
Ali Bouzarif and Aziz Aluthman Fakhroo from QIA and Sarmad Zok from KHC will now join AccorHotels’ board.
AccorHotels plans to generate approximately €65 million in revenue and cost synergies thanks to the combination of brands, the maximisation of hotel earnings, the increased efficiency of marketing, sales and distribution channel initiatives, and the optimisation of support costs.