PARIS Oct 5 AccorHotels expects
investment in its online business and its expansion in the
luxury hotel sector to lift earnings and allow it to triple
revenue in the coming years, CEO Sebastien Bazin said on
AccorHotels, which competes with InterContinental,
Marriott and Starwood, is undergoing a reorganisation initiated
by Bazin, who took over in August 2013.
Bazin told reporters ahead of an "Investor Day" that
AccorHotels expected to triple its business volume within 3-4
years from a current 12 billion euros ($13.5 billion) thanks to
Bazin's first move was to press for raised profitability by
reorganising AccorHotels, which has 3,900 hotels ranging from
budget Ibis to luxury Sofitel, into two units -- HotelServices
and HotelInvest. That split its operating and franchising
business from its real estate and asset management activity.
The acquisition of FRHI Holdings, owner of London's Savoy
and New York's Plaza hotels, would lift the contribution from
the luxury sector to the earnings of the HotelServices division
to over 50 percent by 2020 from 15 percent, he said.
AccorHotels recently announced plans to turn HotelInvest
into a subsidiary ahead of opening a majority of its capital to
institutional investors to raise cash for the group's expansion.
As part of the restructuring, Bazin has also expanded the
group's business in China, and increased its exposure to the
luxury sector with the $2.7 billion acquisition of FRHI
"The integration of FRHI Holdings is on track in terms of
timing and synergies," Chris Cahill, head of luxury brands, told
AccorHotels has said that the FRHI deal would boost earnings
starting from the second year, with 65 million euros in revenue
and cost synergies expected.
AccorHotels has also been strengthening its digital
expertise with a flurry of small deals to fight the rising
challenge of companies such as Airbnb and online travel agents
(OTAs) Expedia and Booking.com.
AccorHotels is also seeking to limit a push by top Chinese
shareholder Shanghai Jin Jiang International to
increase its 12.6 percent stake in the company.
To do that AccorHotels started talks with Jin Jiang and
other shareholders Eurazeo and Colony focused on board
organisation and shareholdings, a source told Reuters in June.
Bazin told reporters on Wednesday there was nothing new
regarding the Jin Jiang situation.
"No good news and no bad news", Bazin said, adding he would
meet Jin Jiang representatives in China next week as well as
officials from other Chinese companies.
($1 = 0.8913 euros)
(Reporting by Dominique Vidalon; Editing by Keith Weir)