It’s been a massive week for AccorHotels, which is moving faster than a rabbit down a hole, chasing new opportunities and deals from Sub-Saharan Africa to the Australian coast, all the while continually reinventing itself as more than an accommodation business.
First, it launched a USD1 billion African hotel development fund with Katara Hosptality; a couple of days later news broke it was selling a record-breaking, $300m Australian hotel portfolio.
Then the company went all-out at a Sydney party for its Australian partners, a powerful mix of celebrities, hotel heavies, industry leaders and media at the jewel in its local crown, Sofitel Darling Harbour.
Larry Emdur was the host, David Koch could be seen moving to his seat, Kerri-Anne Kennerley held the door open for me as I Ieft with a tray of beautiful flowers (they were giving them away) and the Divas from Priscilla Queen of the Desert belted out a few high tempo disco songs before an audience that was more interested in talking.
It was in some ways a statement by AccorHotels that’s it’s become the most deeply connected to Australia of all the international hotel groups since starting out with a couple of properties in Darling Harbour – including the iconic Novotel (everyone has been there) 27 years ago.
It’s certainly Australasia’s biggest accommodation operator by a long-shot – Accor now has 330 hotels and resorts under management after taking on an extra 130 properties with the Mantra acquisition.
But it won’t end there. Accor Asia-Pacific boss Michael Issenberg made it clear that Accor is hungry for more.
Issenberg was also adamant that despite all its corporate machinations, Accor still had hospitality very much at its heart, opening great hotels and welcoming guests was still its core.
Chief Operating Officer at AccorHotels Pacific, Simon McGrath, continued the theme and made a point of bringing all the service staff, headed by the chefs, out to resounding applause.
In between entertainment and ceremony, there was a lot of talk in the crowd about Accor’s $1.2 billion takeover of the Mantra Group, which dragged on until late May with the ACCC sniffing around more than anyone thought it would.
Operations of the two companies only merged a few weeks ago, so it’s very new and somewhat raw.
Staff are still adjusting, though everyone was talking up compatible corporate cultures over seafood bisque, lamb cutlets and deconstructed chocolate mousse.
We’ll know more shortly about how this will play out.
Management has set a 100 day deadline to get things sorted. During his off the cuff remarks, Simon McGrath referenced the ambitious target that will surely challenge staff and systems.
The pressure is on and there are still many unknowns. No merger comes without pain.
Decisions (not all of them pleasant) need to be made on the future of the merged business in key areas such as branding, staffing, operations.
Meanwhile, investment arm AccorInvest is selling 23 of its Australian properties and leaseholds on the market with a speculated price of more than $300 million.
Virtually all of them have locked in Accor contracts, ensuring other hotel groups cannot pounce.
Which leaves cashed up investors, super funds, investment funds as the obvious suitors.
A public listing could be a great opportunity because, ironically, the Mantra Group takeover leaves the Australian Stock Exchange devoid of a pure-play hotel stock.
Meanwhile, on the other side of the world Accor has teamed with Katara Hospitality on a new fund that can leverage up to USD1 billion to develop and operate more than 40 properties across all of Africa south of the Sahara Desert.
“The fund will amount to up to USD 500 million in equity, of which Katara Hospitality and AccorHotels will contribute respectively up to USD 350 million and USD 150 million over the next 5-7 years, with additional financing capacity reached through leverage and co-investments,” Accor said in a statement.
“It will target greenfield projects, brownfield projects and conversions of existing hotels through acquisitions, in a region which offers robust growth opportunities.
“Approximately 40 hotels (around 9000 rooms) will span across the wide range of internationally renowned brands of AccorHotels, from economy to luxury segments, including residences.”
- Accor now defines itself “a world-leading travel & lifestyle group and digital innovator with a presence in 100 countries and 4,500 hotels.”