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AccorHotels Enters Sharing Economy with Latest Acquisition

Europe’s biggest hotel chain operator believes that its latest purchase will bring it into direct competition with Airbnb.

On Tuesday, AccorHotels announced that it has agreed to purchase onefinestay for €148 million (USD $169 million).

Europe’s largest hotel operator plans to invest €64 million ($73 million) to increase the global reach of the start-up, which allows owners of upmarket properties to let out their homes to equally well-heeled travelers.  

While the hotel giant’s recent past acquisitions of the luxury Fairmont and Raffles chains cost $2.9 billion, this latest purchase is much smaller.

AccorHotels hasn’t provided any financial statements for the deal, but the Irish Times has intimated that the purchase price is only four percent of the sales figure.

However, the strategic implications of AccorHotel’s purchase of onefinestay are multiple; indeed, the move is meant to head off competition from the seemingly indomitable Airbnb and is intended to give more power to online booking agents, who receive revenue in exchange for listings on their sites.

The move will also see AccorHotels, which currently classes only 16 percent of its rooms in the luxury bracket, expand its repertoire of upscale properties.

According to Bloomberg Intelligence, as of the fourth quarter, AccorHotels had 511,000 hotel rooms in contrast to onefinestay’s approximately 2,600 available properties.

It is reported that AccorHotels sees the acquisition as the opportunity to compete directly with Airbnb.

By its own estimate, AccorHotels believes that wealthy customers spend €32 million ($36 million) on leisure travel every year. The thinking is that while these guests may opt to stay in one of Accor’s mainstream hotel properties on business, they might want a more bespoke luxury experience on vacations and holidays.

AccorHotel’s acquisition of onefinestay undoubtedly means opening up new booking options for its customers.  But more crucially, it also means that the company will reap the rewards of entering into the skyrocketing share economy of the alternative accommodation market.

Speaking of the acquisition in a statement, Accor CEO Sébastien Bazin said, “AccorHotels’ investment in onefinestay is a tremendous invitation for us to write the next chapter in our story… With AccorHotels’ help, onefinestay will become a globally recognized byword for exceptional experiences, extraordinary service, and handmade hospitality.”

[Photo: AccorHotels]

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