BEIJING, Oct 16 (Reuters) - UK-based private equity investor Actis said on Thursday it led a $65 million investment in China’s 7 Days Inn Group, a player in the mainland’s fast growing budget hotel industry.
Warburg Pincus joined Actis in helping finance 7 Days Inn’s expansion of its national hotel network and strengthen its capital structure, the companies said in a statement.
Shenzhen-based 7 Days Inn, China’s fifth-biggest chain, had plans earlier this year to triple the number of hotels to 200 in 2008 after receiving a combined $95 million from Merrill Lynch MER.N, Deutsche Bank (DBKGn.DE) and Warburg Pincus.
Actis has $6.8 billion invested across the world, mainly in Africa and Asia, with around 10-15 percent directed to the metals, mining, oil and energy sectors.
The number of budget hotel rooms has mushroomed in the past eight years from practically zero to over 100,000 with more than 100 brands competing for a stake in the rapidly expanding domestic tourism market.
China has slowed approvals for foreign private equity deals in recent years due to concerns about foreign ownership of strategic industries and to help nurture a domestic private equity industry.
In July, U.S. buyout giant Carlyle Group [CYL.UL] abandoned plans to buy a significant stake in top construction equipment maker Xugong Group Construction Machinery Co after an initial deal had been struck nearly three years earlier. ($=6.83 yuan) (Reporting by Kirby Chien; editing by Sue Thomas)