Hotels

Marriott to “jumpstart” all-inclusive offering with hotel group acquisition

Marriott International has agreed to acquire Elegant Hotels Group for approximately £100.8 million ($190.4 million), as it looks to grow its presence in the all-inclusive category.

The offer price implies an enterprise value for Elegant of approximately US$199.0 million ($298.7 million) based on the hotel group’s total net debt of $68.9 million ($100.3 million) as at 31 March 2019.

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 west coast of Barbados, commonly known as the “Platinum Coast.” The majority of Elegant properties are operated as all-inclusive resorts.

Commenting on the acquisition, Marriott International president and CEO Arne Sorenson said: “There is a strong and growing consumer demand for premium and luxury properties in the all-inclusive category.

“The addition of the Elegant portfolio will help us further jumpstart our expansion in the all-inclusive space, while providing more choices on the breathtaking island of Barbados for our 133 million Marriott Bonvoy members.”

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.”

Following the acquisition, Marriott said it intends to carry out renovations to the hotels in the Elegant portfolio. Upon completion of the planned property renovations, Marriott will look to operate all the Elegant hotels as all-inclusive resorts under one or more of its collection brands.

Over time, Marriott said it also intends to market the Elegant hotels for sale subject to long-term management agreements under which it 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 and its hotel brands.

Completion of the transaction is subject to satisfaction or waiver of the offer conditions set out in the offer announcement, including approval by Elegant shareholders.

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