Shanghai Jin Jiang International Hotels (Group) Co. plans to buy France’s Louvre Hotels Group, the second-largest European hotel group, for up to €1.21 billion ($US1.43 billion).
The state-owned company, one of China’s biggest hotel groups, said in a statement late Wednesday it plans to buy Louvre Hotels Group from Starwood Capital Group, an international real-estate investment fund incorporated in the U.S., in a deal valued between €1.25 billion and €1.5 billion.
Shanghai Jin Jiang, which said the actual consideration of the deal will be in a range of €960 million to €1.21 billion, plans to fund the purchase via internal resources and bank loans.
The proposed deal comes as Chinese firms move to snap up more hotel assets. In October, Chinese firm Anbang Insurance Group agreed to buy the Waldorf Astoria hotel in New York City from Hilton Worldwide for $US1.95 billion. Hong Kong-based investor Kai Yuan Holdings also recently bought the Paris Marriott Hotel Champs-Élysées.
Shanghai Jin Jiang has been actively looking at opportunities to invest in Louvre Hotels Group and other potential targets over the past three years. It said the proposed deal would allow it to tap China’s growing appetite for European travel. By acquiring Louvre Hotels Group, it can “quickly expand its businesses in the international market and realize its internationalization strategy,” it added.
Louvre Hotels Group has more than 1,100 hotels with 91,154 hotel rooms in 46 countries around the world, of which 970 hotels are in Europe. It is made up of luxury and budget hotels under the brands of Premie’re Classe, Campanile, Kyriad and Royal Tulip.