Jin Jiang International Holdings Co (錦江國際酒店集團), which owns Shanghai’s 85-year-old Peace Hotel, agreed to buy Groupe du Louvre in a bid to expand its global franchise.
Jin Jiang signed an agreement with Starwood Capital Group to buy the hotel company and subsidiary Louvre Hotels Group for an undisclosed price, it said on its Web site on Wednesday.
The deal is valued at more than 1.2 billion euros (US$1.49 billion), the Wall Street Journal reported, citing unidentified people familiar with the matter.
Chinese investors are snapping up trophy hotel properties around the world, seeking to cater to a growing number of wealthy Chinese that are traveling more outside the country. Anbang Insurance Group Co (安邦保險集團) is buying New York’s Waldorf Astoria hotel for US$1.95 billion.
Jin Jiang, which wants to build itself into a “world-class brand name,” is expanding after profit more than tripled at its main domestic unit in the first half of the year on demand for domestic travel in China. The firm owns 50 percent of IHR Group, which manages 434 hotel properties in 11 countries, mostly in the US.
“There is strong complementary synergy between Louvre Hotels and Jin Jiang in brand portfolio, geographic footprint and guest base,” Jin Jiang chairman Yu Minliang (俞敏亮) said in the statement. “We are looking forward to working with the management, employees and other stakeholders of Louvre Hotels Group to create larger space for both parties to grow globally.”
Paris-based Louvre Hotels is the second-largest hotel group in Europe, with more than 1,100 hotels in more than 40 countries, according to the statement. The transaction may be completed in the first quarter of next year.
Net profit at unit Hong Kong-listed Shanghai Jin Jiang International Hotels (Group) Co rose 222 percent in the first six months to 422 million yuan (US$68.9 million) as revenue recovered.
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