AccorHotels has revealed it has entered an agreement with Mantra Group to acquire the company.
Following speculation earlier this week, the two hotel companies have signed a scheme of arrangement, pending approval by Mantra shareholders, for the price tag of AU$1.18 billion.
Under the terms of the agreement AccorHotels would offer AU$3.96 in cash for each Mantra share including any potential special dividend. The offer price represents a 23 per cent premium to the last close price of AU$3.23 as at 6 October 2017.
It is anticipated that subject to regulatory and shareholder approvals, from the likes of the Australian Foreign Investment Review Board, the Federal Court of Australia and the Australian Competition and Consumer Commission, the transaction should be completed by the end of the first quarter 2018.
AccorHotels and Mantra’s combined geographic footprint, together with enhanced distribution and systems, would form a favourable base for AccorHotels to expand further in the APAC region, something reiterated by Chairman and CEO of AccorHotels, Sébastien Bazin.
“We are delighted to have come to an agreement to acquire the Mantra Group,” Bazin said.
“This operation will underpin our long-term growth in the Asia Pacific region. Mantra’s portfolio would offer AccorHotels additional accommodation formats and a strong customer base to complement our successful hotel portfolio in Australia.
“We are confident that the transaction terms are attractive for shareholders of both groups”.
Mantra released a statement on the Scheme this morning, confirming it had “entered into a binding agreement with Accor”.
“The directors of Mantra unanimously recommend that Mantra shareholders vote in favour of the Scheme, and intend to vote Mantra shares in their control in favour of the Scheme,” it stated.
Chairman of Mantra, Peter Bush, said, “The AccorHotels offer represents an attractive proposition for Mantra and for our shareholders and the Board unanimously recommends AccorHotels’ proposal.
“AccorHotels is one of the world’s leading hotel operators and we trust that our business will be in good hands.
“Mantra’s strong expertise in apartments, in particular, and our presence in resort locations are very complementary to the AccorHotels operations in Australia and New Zealand.
“The combined business will be an important part of Australia’s strong and growing tourism market and its customers will benefit from the market leading expertise of both groups”.
Mantra is one of Australia’s largest hotel and resort marketers and operators with 127 properties and over 20,000 rooms in hotels, resorts and serviced apartments across Australia, New Zealand, Indonesia and Hawaii.
Properties in Mantra’s portfolio range from luxury accommodations and coastal resorts to serviced apartments in city and key leisure destinations, under three key brands: Peppers (28 properties), Mantra (75 properties) and BreakFree (24 properties).
Mantra also manages core accommodation services including guest relations and reception areas, restaurants and bars, conference and function centres, pool and entertainment facilities and offices. Mantra has more than 5,500 employees.