Expanding. Accor and Huazhu Hotels Group (also known as China Lodging Group – Nasdaq: HTHT) today sealed an extensive and long-term alliance to create the most prominent and diversified hotel company in China, with more than 2,000 hotels and the strongest pipeline in the country.
“This ground-breaking collaboration will leverage the strengths of Accor’s global brands with a leading player in Chinese hospitality,” said Sebastien Bazin, Chairman and CEO of Accor. “Joining Huazhu’s unparalleled local expertise with our brands will create a hospitality powerhouse which will deliver unprecedented value to both groups and to our customers.”
Huazhu founder, Chairman and CEO, Ji Qi, said the collaboration was an unequivalent alliance in the global hospitality industry. “With an extensive brand portfolio, and strong distribution and loyalty platforms, Accor and Huazhu share a lot of common values. By combining forces we can facilitate growth and attract more customers to the expanded network,” said Ji Qi.
Together the groups have more than 500 hotels in the pipeline in the region and the alliance is expected to further accelerate development to see faster expansion of Accor’s brands in China. This strategic alliance aims at accelerating expansion by leveraging Huazhu’s strength in development, real estate investor relations and experience in operating a sizable hotel network in China. Huazhu plans to open 350 to 400 new hotels under the Accor brands in the next five years.
“China is today the largest outbound tourism market in the world; in that context, creating one of the largest hotel groups in China will lead to growth globally as those travelers come to recognize Accor and Huazhu’s brands and expand their travel internationally,” said Sebastien Bazin. “This agreement will also help us better anticipate customers’ expectations and strengthen our leadership in the Chinese market over the long term.”
“We are thrilled that our long-time friendship with Accor matures into a long-lasting alliance,” said Ji Qi. “We believe the collaboration will become the largest hotel business in China, and make the Accor-Huazhu alliance an unprecedented success.”
The conditions to the closing of this transaction include the obtaining of requisite governmental approvals and the completion of certain corporate restructuring. Both Accor and Huazhu will use due efforts to achieve the closing conditions in an expedited manner.