InterContinental Hotels Group has agreed to buy the brands and operating companies of Six Senses Hotels Resorts Spas for $300 million in cash, the owner of the Crowne-Plaza and Holiday Inn chains said on Wednesday, in a move that beefs up its luxury portfolio.
IHG, which has been pressured by competition from online rental services like Airbnb, has looked to re-focus on competing with the sprawling luxury portfolios run by Marriott and Hilton.
“Six Senses is an outstanding brand in the top-tier of luxury and one we’ve admired for some time,” Chief Executive Officer Keith Barr said of the deal, which takes IHG’s total portfolio of luxury hotels to 400 properties with 108,000 rooms.
Six Senses currently manages 16 hotels and resorts, with 18 management contracts signed in its pipeline, and more than 50 further deals under active discussion. It operates properties in the Maldives, Seychelles, Thailand, Oman, and Portugal’s Douro Valley among others.
The company said it expects to expand Six Senses, which generates fee revenues of over $13 million, to more than 60 properties globally over the next decade, including to the high-end West Chelsea, Manhattan area of New York City.
The acquisition from private asset management firm Pegasus Capital Advisors does not include any real estate assets and would generate a return approximately equal to its cost of capital by the fourth year after the purchase, IHG said.
Source: Reuters.com