Accor in $1.18-bn bid for Australia's Mantra Group Ltd
09 October 2017
Europe's biggest hotel operator Accor SA has made a A$1.18 billion ($920 million) bid for Mantra Group Ltd, in a deal that would combine the two biggest hotel owners in Australia and seek to capitalise on surging tourism in the country.
Accor has offered A$3.96 a share, or a 23-per cent premium to Mantra's closing price on Friday. According to a statement by Mantra, the total offer is worth A$4.02 per share if a six-cent final dividend paid in 2017 is included.
''They haven't lowballed it, that's for sure,'' said Anthony Porto, portfolio manager at Martin Currie Australia, which owns a stake in Mantra, Reuters reported.
According to commentators, a deal would be the second-largest in the hotel sector of Australia. Shares in Sydney-listed Mantra shot 17 per cent today as investors bet on regulatory clearance.
According to Mantra, it has allowed Accor to conduct due diligence ''to determine if a transaction can be agreed and recommended unanimously by the Mantra board.''
The development comes as Australia's hoteliers gear up to add new rooms to meet surging demand. The number of visitors to Australia rose 9 per cent in the past financial year to hit a record 7.9 million even as spending on international visitors increased to $40.6 billion, which is also a record.
The deal would be the biggest acquisition by Accor in the Asia-Pacific region, which will give it over 20,000 rooms across Australia, New Zealand and Indonesia as also access to a growing tourism market. According to Bloomberg Intelligence analyst, Maragaret Huang, a Mantra purchase would advance Accor's efforts to add properties in the mid- and upscale markets, especially in the Asia-Pacific region.
''The region already generates around 20 percent of total revenue and is supported by growing Chinese travel demand,'' she said.