AccorHotels Group has confirmed the acquisition of FRHI Hotels & Resorts and its three prestigious luxury hotel brands: Fairmont, Raffles and Swissôtel.
In conjunction with the acquisition, Chris Cahill has been appointed as AccorHotels’ chief executive luxury brands.
Following the approval of shareholders, AccorHotels said the addition of the three renowned brands instantly positioned AccorHotels as a leading player in the global luxury hotel market, increased long term growth potential and profitability, and significantly expanded the company’s footprint in North America, “the world’s largest and most influential consumer market”.
“Today is a great day for our group,” said AccorHotels chairman and chief executive, Sébastien Bazin.
“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.”
The deal includes management of many of the world’s most iconic and historic hotels located in key strategic cities around the world, including: 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.
AccorHotels will now seek to combine FRHI’s proven track record and deep expertise in operating and marketing luxury hotels, with its own robust global operating platform, extensive loyalty base and industry leading digital capabilities. The combination, AccorHotels says will allow it to deliver the most profitable returns and best growth potential across all market segments.
“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,” Bazin added.
“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.”
In support of the acquisition, and as part of AccorHotels’ larger strategy to strengthen its luxury and upscale business, Chris Cahill has been appointed as AccorHotels’ chief executive luxury brands, a newly created role.
Cahill 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.
Cahill 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.
There’s a strong Middle Eastern link. Following the approval of shareholders at the General Shareholders Meeting on 12 July 2016, the transaction with Qatar Investment Authority (QIA) and Kingdom Holding Company (KHC) of Saudi Arabia provided USD 840 million (EUR 768 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% and 5.8% in Accor’s share capital. Ali Bouzarif and Aziz Aluthman Fakhroo from QIA and Sarmad Zok from KHC will now join AccorHotels’ Board of Directors.
Edited by Peter Needham