AccorHotels will acquire the Mantra Group in a deal worth AUD$1.3 billion which will see AccorHotels add 127 hotels to its network across Australia, New Zealand, Indonesia and the United States, a deal understood to be brokered by JLL's Hotels and Hospitality Group.
The deal will see AccorHotels aquire Mantra Groups shares for $3.96 each, boosting Accor's network to over 370 hotels in the Australasia region.
“The Board of Directors of Mantra Group Limited is pleased to announce it has entered into a binding agreement with Accor S.A whereby AccorHotels will acquire all of the shares of Mantra at a price of AUD$3.96 cash per share (on a fully diluted basis), including a potential share dividend, by way of a scheme of arrangement,” Mantra Group said in a recent ASX Release.
“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, in each case in the absence of a superior proposal and subject to an Independent Expert concluding that the Scheme is in the best interest of Mantra shareholders."
AccorHotel’s Chairman and CEO, Mr Sebastien Bazin, said: “We have long admired the Mantra business, both in respect of its brands and properties as well as its people and processes. We will be looking to bring together the best of both companies to provide an enhanced experience for our customers and employees in what is an exciting period of growth of the industry in Australia and New Zealand.”
Mantra’s Chairman, Mr Peter Bush said: “Mantra’s Board has concluded that the sale of the Company at a significant premium to market is an attractive outcome for shareholders. After careful consideration, the Board believes that the offer price of A$3.96 cash per share recognises the strategic value of our business and our success in becoming a leading accommodation provider. The offer represents compelling value and provides an attractive opportunity for shareholders to realise this value.”
Under the terms of the Scheme, Mantra shareholders will be entitled to receive A$3.96 cash per share (Cash Consideration) subject to all applicable conditions being satisfied or waived and the Scheme being implemented. The Cash Consideration represents an implied market capitalisation of A$1,182.2 million and an implied enterprise value of A$1,254.6 million for the year ended 30 June 2017, on a fully diluted basis.
In addition, Mantra will have the discretion to pay shareholders a special dividend of up to a maximum of 23.5 cents per share (Special Dividend) which will be deducted from the A$3.96 headline value. The size of any potential special dividend (if declared) will be determined by the Mantra Board having regard to a range of factors, including the availability of franking credits.
Mantra has retained Highbury Partnership Pty Ltd as financial adviser, and Baker McKenzie and Hogan Lovells as legal advisers. JLL Hotels and Hospitality (M&A) is acting as commercial adviser to Accor S.A. on the transaction.
View the full Mantra Group ASX Announcement.
See also:
AccorHotels makes $1.2 billion bid to acquire Mantra Group
Wyndham Hotel Group completes $170 million acquisition from Northcott Hospitality