News for the Hospitality Executive
|PARIS, January 14, 2007 - Accor, which previously owned
a 34% stake in Dorint AG, has acquired control of 52 upscale and midscale
hotels that were part of Dorint's network of 93 hotels.
As part of a restructuring plan, Dorint's board has decided to split the company in two:
By subscribing a EUR52 million capital increase, Accor has acquired a controlling interest in one of the new companies, which operates 52 hotels.
Of the hotels, eight were previously operated under the Dorint Sofitel brand, 17 under the Dorint Novotel brand and 27 under the Mercure brand. In the first half of 2007, they will be rebranded as, respectively, Sofitel, Novotel and Mercure units.
Also during the first half, Accor will buy out the minority interests for EUR75 million, resulting in the Group owning around a 90% stake in the new company.
Financially, the transaction has enabled Accor to gain control of 52 hotels, which generate around EUR300 million in revenue and are expected to report 2007 EBITDA of around EUR16 million after the rent reductions granted by lessors and profit before tax of EUR10 million. By comparison, accounting for Dorint AG by the equity method will probably result in an estimated EUR8 million loss for Accor's share in 2006.
Ebertz & Partner has acquired all shares of the new company, which will operate 41 Dorint hotels under the Dorint brand.
The transaction is subject to the approval of European competition authorities, which is expected within the next few weeks.
Strategic impact for Accor
The transaction is being carried out at time when the German economic environment is favorable and the hotel industry is showing a very clear improvement, as demand has risen sharply while room supply has not significantly increased.
Strategically, the transaction enables Accor to complete the program launched in 2003 to reposition the Sofitel, Novotel and Mercure networks in Germany:
In total, Accor is the leading hotel operator in Germany, Europe's largest outbound market, with a portfolio of 331 hotels.
Gilles Pelisson, Accor's CEO declares: "With a strengthened presence in one of today's most dynamic European market, Accor is ready to capitalize on its past partnership with Dorint, thanks to a repositioned network on downtown locations, which will enable the emergence in Germany of the Sofitel and Novotel brands and the consolidation of the Mercure network".
With 160,000 associates in nearly 100 countries, Accor is the European leader in hotels and tourism and the global leader in corporate services.
|Also See:||Bass Hotels & Resorts and Dorint Hotels & Resorts Agree to Joint Venture and Develop Inter-Continental and Dorint Hotels in Germany / May 2000|
|Accor to Acquire a 26% Interest in German Hotel Group Dorint AG / August 2002|
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