China Conglomerate HNA Group’s Unit to Buy Carlson Hotels
HNA Tourism’s deal marks yet another major consolidation in global hotel industry
Mumbai: A unit of Chinese conglomerate HNA Group has agreed to buy Carlson Hotels, the owner of several brands including Radisson and Country Inns and Suites, in what marks yet another major consolidation in the global hotel industry. HNA Tourism Group Co, a division of aviation and shipping major HNA Group Co will acquire 100% of Carlson Hotels and also its 51.3% state in Brussels-based Rezidor Hotel Group AB, which operates Carlson hotels in Europe, Africa and the Middle East, the companies said in a joint statement.
The purchase price was, however, not disclosed. HNA Tourism chairman Haibo Bai said buying Carlson Hotels will help the Chinese company “establish our presence in the US market and expand our footprint in hospitality internationally”.
Carlson Hotels has1,400 properties with more than 2,20,000 rooms under operation in 115 countries and territories. In India, Carlson Rezidor is the third-largest hotel company by operating hotels and room inventory as of September 2015, according to hotel consultancy HVS. Tata-owned Taj Group and ITC Hotels rank first and second currently. Once Marriott International completes the acquisition of Starwood Hotels by mid-2016, the combined entity will become the market leader in India, displacing the Taj Group. “Joining hands with HNA allows Carlson to invest more in technology, digital space and also into ownership of hotels in gateway markets as these are the demand drivers for any destination,” said Raj Rana, CEO-South Asia at Carlson Rezidor.
India is the second-largest market for the American hospitality management company, its Asia Pacific president Thorsten Kirschke told ET during a recent interview. The hotel chain has 43 hotels in the pipeline in India, only surpassed by the US.
HNA plans to invest “substanti- ally” in Carlson’s hotel business to accelerate growth and building of Radisson RED and other new brands.
After the completion of the deal, Carlson Hotels will maintain its headquarters at Minnetonka in Minnesota, US and David P Berg, CEO of Carlson Hospitality Group will continue in the same role at the new organisation.
Besides Radisson, Radisson Blu and Radisson Red, the company owns the Quorvus Collection, Park Inn by Radisson, Country Inns & Suites by Carlson and the Club Carlson frequent-guest programme.
The deal, subject to regulatory approvals, is expected to be completed in the second half of 2016. HNA Group, based in southern Hainan province, operates hotels, airlines, airports and financial services and real estate businesses. It is one of the biggest shareholder in Spanish hotel company NH Hotel Group SA.
HNA's acquisition of Carlson is part of a wave of Chinese investment in overseas hotel properties and brands, amid increasing overseas travel by Chinese and concern about yuan devaluation.
The deal is expected to be completed in 2016, and once done, Carlson will retain its current headquarters in the US and also its CEO