AccorHotels discussing with Jin Jiang International about stake hike to up to 29%
AccorHotels [EPA:AC], the listed French accommodation group, is understood to be discussing a potential increase of the shareholding owned by China’s Jin Jiang International Holdings in the French group, French daily Le Figaro reported. The report cited a person familiar with the matter as saying that Jin Jiang International, which already held 15% in AccorHotels as of last week, is hoping to increase its shareholding to 29%. An offer at EUR 45 per share has been made for the 11.08% stake in AccorHotels jointly held by investment funds Eurazeo and Colony Capital.
According to the report, the offer was made in Spring and is still on the table. While the shares in AccorHotels are currently trading at EUR 38 per share, the report noted that Eurazeo and Colony already sold a 9.65% stake in the French group last year at a price of EUR 49 per share. The report also claimed that the funds are requesting that Jin Jiang gets the agreement from the board and the management of AccorHotels.
The report added that the ongoing discussions also include the French government and the Chinese authorities, as Jin Jiang is owned by the municipality of Shanghai. The French government, which wants to prevent a creeping takeover of AccorHotels, is believed to want Jin Jiang to sign an agreement similar to that signed by automotive group Dongfeng for French carmaker PSA Peugeot Citroen, the report said.
The agreement could include a standstill clause, whereby Jin Jiang would agree not to increase its stake in AccorHotels to up to a certain threshold, as well as details on the future governance of AccorHotels and access to certain “strategic information” within the group.
The report noted that Jin Jiang already owns Louvre Hotels, the main competitor of AccorHotels in France, and that the Qatari sovereign fund and Saudi Arabia’s Prince Al-Walid will acquire a stake of 10.5% and 5.8% in AccorHotels respectively once the acquisition of FRH by Accor is completed. The report cited a source as saying that Sebastien Bazin, head of AccorHotels, is trying to prevent a takeover and would agree to give Jin Jiang a seat at the board of the group if the latter vows not to take control of the French group. The report also noted that AccorHotels alreayd has a partnership to develop in China with Huazhu, a competitor to Jin Jiang.
The report added that discussions have intensified in the last days and that an agreement could be signed ahead of Accor’s general assembly scheduled in the middle of July.
Le Figaro