PARIS — A French-based hotel chain has announced a deal worth nearly $3 billion to acquire the luxury Fairmont, Raffles and Swissotel brands from the property arm of a major Ontario pension plan and investment companies in Qatar and Saudi Arabia.
Accorhotels SA says it will make a cash payment of US$840 million and issue 46.7 million new Accor shares under terms of the agreement with Oxford Properties, the Qatar Investment Authority and Kingdom Holding Company of Saudi Arabia.
Both the Qatar and Saudi companies are to become major Accor shareholders, with 10.5 and 5.8 per cent of the share capital, respectively.
The announcement did not contain any details on the payment to Oxford Properties, which is part of the Ontario Municipal Employees Retirement System, also known as OMERS.
Based on Accorhotels' closing stock price Wednesday, the overall value of the deal is worth US$2.84 billion.
By obtaining the assets of FRHI Holdings Ltd, Accorhotels will gain a global collection of 155 hotels and resorts, of which 40 are under development.
In Canada, they include the Fairmont Banff Springs in Alberta and Fairmont Le Chateau Frontenac in Quebec.
Other well-known properties covered by the deal are Raffles Singapore, the Savoy in London, Shanghai's Fairmont Peace Hotel and the Plaza Hotel in New York.
Overall, FRHI has hotels and resorts in 34 countries across five continents, with 42 properties in North America, two in South America, 26 in Europe, 17 in the Africa-Middle East region and 28 in the Asia-Pacific region.
Accorhotels has almost 500 luxury and upscale properties.Suggest a correction