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In a busy week for Marriott, the company has reached an agreement with the board of Elegant Hotels Group on the terms of a recommended all cash offer.
Under the terms of the offer, each Elegant shareholder would be entitled to receive 110 pence per Elegant share.
The offer values the entire issued and to be issued ordinary share capital of Elegant at approximately $130 million, or £100 million.
The price implies an enterprise value for Elegant of approximately $199 million based on Elegant’s total net debt of $68.9 million as at March this year.
Elegant owns and operates seven hotels with 588 rooms and a beachfront restaurant on the island of Barbados.
Six of the seven properties are situated along the prestigious west coast of Barbados commonly known as the Platinum Coast.
The majority of Elegant properties are operated as all-inclusive resorts.
“There is a strong and growing consumer demand for premium and luxury properties in the all-inclusive category,” said Arne Sorenson, chief executive, Marriott International.
“The addition of the Elegant portfolio will help us further jumpstart our expansion in the all-inclusive space, while providing more choices on the breath-taking island of Barbados for our 133 million Marriott Bonvoy members.”
Following the acquisition, Marriott intends to carry out renovations to the hotels in the Elegant portfolio.
Upon completion of the planned property renovations, Marriott intends to operate all the Elegant hotels as all-inclusive resorts under one or more of its own collection brands.
In keeping with Marriott’s asset-light strategy, over time, Marriott also intends to market the Elegant hotels for sale subject to long-term management agreements under which Marriott would continue to manage the hotels.
In August, Marriott launched an all-inclusive platform with the goal of growing a worldwide portfolio of resorts in popular vacation segments by leveraging the company’s operational and development expertise, its Marriott Bonvoy travel program with roughly 133 million members, and its iconic hotel brands.
Commenting on the acquisition, Simon Sherwood, non-executive chairman of Elegant said: “The board of Elegant Hotels is confident in the group’s long-term prospects but believes that this offer represents compelling value for our shareholders and a great opportunity for our employees to be part of one of the world’s leading hotel companies.
“The fact that Elegant Hotels has attracted the interest of a company of Marriott’s calibre is a resounding endorsement of the outstanding quality of our properties, operations and people, and indeed of Barbados as a highly desirable destination. We are therefore unanimously recommending the offer to shareholders.”
Source: breakingtravelnews.com
