French investment firm Eurazeo Patrimoine has announced it has closed the purchase of a portfolio of 85 European hotels and launched a new hotel platform called Grape Hospitality.
Eurazeo Patrimoine, the real assets investment arm of Eurazeo, first announced in January that it was in exclusive negotiations with AccorHotels to acquire the portfolio, which includes 85 budget and mid-range hotels - both real estate and business - located in France and seven other European countries.The assets provide 9,125 rooms.
Under the agreement, which values the portfolio at €504 mln, Eurazeo and AccorHotels will hold stakes of 70% and 30% respectively in the new business which will hold the assets. There is also the possibility of a third institutional investor joining the venture in the short term, Eurazeo said. Eurazeo will fork out €150 mln for its stake.
The acquisition was funded with debt of €324 mln. In addition, Grape Hospitality has secured an additional credit facility of €60 mln which will be used to renovate the portfolio of hotels, which are all AccorHotels franchises (Ibis, Ibis Budget, Ibis Styles, Mercure, Novotel, and Pullman).
The new platform will be headed by Frédéric Josenhans, former managing director of Mercure and Novotel brands and will focus on the acquisition of hotels or hotel portfolios with value creation potential.
With a diversified portfolio of over €5 bn in assets, Eurazeo is a major listed investment company which covers most private equity segments through its four business divisions – Eurazeo Capital, Eurazeo Croissance, Eurazeo PME and Eurazeo Patrimoine.
