Comprehensive M&A data with integrated detailed company information

Hyatt heads down Two Roads as it seeks expansion
Posted on Tuesday, 09 October 2018 09:42
Hyatt Hotels has reached an agreement to acquire Two Roads Hospitality for a potential USD 600.00 million to expand its brand footprint and pipeline.

The addition of the target’s Alila, Destination, Joie de Vivre, Thompson and tommie properties is expected to significantly strengthen the buyer’s lifestyle and wellbeing offerings for the high-end travel market.

Under the terms of the offer, Hyatt will pay USD 480.00 million up front with a possible further USD 120.00 million injection depending on the outcome of certain terms to be individually defined after completion.

Two Roads is billed as an international lifestyle hotel management company with established lifestyle brands and agreements to run 85 properties across eight countries.

Hyatt is expecting that the deal will enable it to enter 23 new markets while enhancing its offerings in the area in which the target operates.

If the full earn-out payment is made, the total offer price values Two Roads at a multiple of 12.0 to 13.0x established 2021 earnings before interest, taxes, depreciation and amortisation.

The deal is said to be consistent with Hyatt’s long-term strategy to drive shareholder value.

Following closing, expected to occur before the end of 2018, the buyer will create a lifestyle division to bring the operations of Two Roads together with its existing activities in the market.

Mark Hoplamazian, chief executive of the acquiror, added: “Importantly, combining Two Roads’ meaningful brand presence and development plans in Asia with Hyatt’s already strong position in this region will allow us to accelerate expansion in this critically important and fast-growing part of the world.”

According to Zephyr, the M&A database published by Bureau van Dijk, there have been 450 deals targeting companies in the traveller accommodation sector announced worldwide since the start of 2018.

The largest of these involves French hotel company Accor selling a 57.8 per cent stake in AccorInvest to a consortium comprising Public Investment Fund, Amundi Private Equity Funds and GIC Private Markets, among others, for EUR 4.60 billion.

Hilton Worldwide Holdings completed a secondary offering of shares from HNA Group in a deal worth USD 4.82 billion in the second-biggest deal.

Other targets included Wynn Resorts, Radisson Hospitality and La Quinta Holdings’ hotel franchise and hotel management businesses.

© Zephus Ltd