Hony-backed Jin Jiang buys Louvre Hotels

The financial terms were not disclosed but the Financial Times reported the price exceeded EUR1.2 billion ($1.5 billion) and valued the company at more than 11 times EBITDA. Other bidders for the asset reportedly included private equity firms PAI Partners and Oaktree Capital.

Established in 1976, Paris-based Louvre operates more than 1,100 properties in over 40 countries, ranging from one to five stars, under the Premiere Classe, Campanile, Kyriad, Tulip Inn, Golden Tulip, Kyriad Prestige and Royal Tulip brands. Starwood Capital acquired the company in 2005 for $3.2 billion.

"Together with Jin Jiang, we expect the brands will be able to strengthen their capacity and capture the strong growth potential that clearly exists in China and, more broadly, in Asia," said Barry Sternlicht, CEO of Startwood Capital, in a statement.

Louvre and Jin Jiang International formed commercial partnership in 2011, with a view to building up public awareness of the companies and boost hotel tourism between the two countries. Minliang Yu, chairman of Jin Jiang, said that, upon completion of the deal, the companies will focus on branding and expanding the geographic footprint and customer base.

Jin Jiang operates over 1,700 hotels in 11 countries. In August, Hony agreed to acquire a 12.43% stake in the company for RMB15 billion ($246 million).

The private equity firm is seeing more buyout opportunities involving healthcare and restaurant chains, as well as cross-border transactions. In July, it bought UK-based restaurant chain Pizza Express for GBP900 million ($1.54 billion).

The Louvre transaction is expected to close in the first quarter of next year.

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• Topics
• Greater China
• Buyouts
• Consumer
• Real estate
• China
• Outbound investment
• Hony Capital
• Consumer
• Real estate