Starwood sells Louvre Hotels to Chinese Jin Jiang International Holdings Co. Ltd. effective in the first quarter of 2015.
For an undisclosed amount, Starwood Capital has initiated a sale of its Louvre Hotels Group to Jin Jiang International Holdings in China. The companies expect the sale to complete in the first quarter of 2015. Jin Jiang outbid Accor, which was also hoping to buy the budget hotel group.
Prior to the current sale of Jin Jiang, the Chinese company had already established a business relationship with the Louvre Hotels Group. In November 2011, the two companies entered a partnership that co-branded several of their properties in some major cities. Even though the purchase price for this sale was kept private, sources close to the sale said the agreement was for more than €1.2 billion ($1.5 billion).
Louvre Hotels operates properties in more than 40 countries under seven brands: Premiere Classe, Campanile, Kyriad, Tulip Inn, Golden Tulip, Kyriad Prestige and Royal Tulip. Jin Jiang already has properties in 11 countries. Yu Minliang, Jin Jiang’s chairman, feels the purchase of Louvre Hotels is right on target, noting that the two companies have a synergistic portfolio and customer base. Barry Sternlicht, Starwood’s chief executive, agrees and expects the brands to work together harmoniously toward expansion and booking growth.
The winning bid for the Louvre group was Jin Jiang’s second attempt at the purchase—the first offer came in too low, prompting a bidding war with Accor.
[Photo: Louvre Hotels Group]