Apple Leisure Group Debuts in Spain with its Purchase of a Majority Stake in Alua Hotels

23 January 2019 – Revista 80 Días

The US group is one of the largest managers of accommodation in the Caribbean. This purchase allows it to enter the vacation segment and the European market.

Apple Leisure Group (ALG), one of the largest hotel investors in the USA, has acquired a majority stake in the share capital of Alua Hotels and Resorts, the hotel group founded in 2015 by its main executives and the private equity fund Alchemy Partners. The amount of the purchase has not been revealed, although the joint operating result of the chain’s main hotels amounted to €6 million in 2017. Given that the properties are located in areas with high tourist demand and good forecasts, the amount of the operation could have exceeded €40 million, based on the multiples that are typically used for this type of transaction.

With this acquisition, ALG is entering the European market through the sun and beach holiday segment. And it is doing so in a country such as Spain, which receives more than 80 million tourists per year in search of that kind of offer. Alua Hotels has 11 hotels located in Mallorca, Ibiza, Fuerteventura and Tenerife, together with an apartment building in Ibiza.

In total, ALG will manage more than 3,000 4-star hotel rooms, focused on the type of tourist who wants a superior service to that usually found in the average accommodation establishments in beach areas. The US company is planning to undertake more acquisitions in the European market and has announced that it wants to become a reference player in the main destinations in the Mediterranean (…).

Apple Leisure Group is one of the most important investment conglomerates in tourism in the USA. It used to be owned by the investment fund Bain Capital (…), which sold it in 2017 to the funds KSL Capital Partners and KKR for an undisclosed sum. (…). According to data from the conglomerate, it manages 14 brands and handles more than 3.2 million passengers per year (…). Its turnover exceeds USD 3 billion per year (…).

Original story: Revista 80 Días 

Translation: Carmel Drake

Catalonia Hotels Buys 2 Buildings in Málaga to Convert into 72-Room 4-Star Hotel

25 July 2018 – Press Release

Catalonia Hotels & Resorts has completed the purchase of two buildings in the historical centre of Málaga, whereby expanding its presence in Andalucía. This operation will involve an investment of €24 million, including the acquisition of both properties and the complete renovation of the existing homes. The purchase also involves the operation of 600 m2 of space devoted to retail premises.

The hotel, located at number 5 on the central Calle Puerta del Mar, plans to open its doors in 2020. Its installations will house 72 rooms, a restaurant, bar and fitness area.

This will be the seventh establishment for Catalonia Hotels & Resorts in Andalucía, where it already has two hotels in the town of Ronda, three in the city of Sevilla and one that it recently opened in the centre of Granada.

The company’s expansion department, led by Federico Holzmann, does not rule out continuing to study opportunities in the south of Spain. According to Holzmann, “Andalucía is a very attractive market for us, where tourism is continuing to grow. Towns such as Córdoba, Cádiz and Marbella, where we do not have a presence yet, could be interesting destinations for the expansion of our portfolio”.

At the national level, Catalonia Hotels & Resorts plans to open an establishment soon in San Sebastián and another in Bilbao, in addition to the expansions of its properties in Sevilla (Catalonia Santa Justa) and Menorca (Catalonia Mirador des Port).

In Europe, the chain is going to venture into the Italian market shortly with the upcoming opening of Catalonia Milano Centrale, and in Portugal with a new hotel in Oporto.

The 5 new projects share common traits, given that they will all be 4-star superior urban establishments, located in privileged, central and well-connected areas, and equipped with catering, leisure and wellness areas.

In addition, Catalonia Hotels & Resorts is going to expand its presence in the Caribbean with the construction of a 5-star All Inclusive resort on the Riviera Maya with 434 rooms located on the paradisiacal beach of Costa Mujeres.

Catalonia Hotels & Resorts 

A family run hotel chain founded in 1982 by the Vallet brothers. After starting out focusing on the real estate sector, the company inaugurated its first hotel establishment in 1983 to become one of the main hotel chains in Spain in just a few years. Currently, the company has 69 establishments, located in 22 different destinations: 57 hotels in Spain, two in Brussels, one in Berlin, 8 resorts in the Caribbean (4 in the Dominican Republic and 4 in Mexico) and one urban hotel in the city of Santo Domingo. At the moment, Catalonia Hotels & Resorts is a leading player in Barcelona, where it has more than 3,000 rooms.

Original story: Press Release

Translation: Carmel Drake

Palladium Hotel Group Forecasts Revenues of €600M+ in 2017

4 December 2017 – Expansión

The hotel group Palladium expects to record revenues of more than €600 million this year, although that figure is lower than initially expected due to the renovation of several hotels and the impact on demand of the hurricanes in the Caribbean and the crisis in Cataluña. According to the Director-General of Palladium, Abel Matutes Prats (pictured below), the final result will depend on the firm’s performance during the last stretch of the year, after two strong months in the Caribbean. The hotel chain owned by the Matutues family has registered a good season in Spain, in particular in the urban segment.

Original story: Expansión

Translation: Carmel Drake

Hotelier Catalonia Leads Ranking of Spain’s Top 15 Tourism Companies by Gross Margin

24 November 2017 – Preferente

Catalonia, the hotel chain based in Barcelona and owned by the Vallet family, leads the first ranking compiled by preferente.com of the Top 15 Spanish tourism companies by gross margin in 2016, with a 30.2% gross profit on its sales. It is followed by large hotel chains such as the Ibiza-based Palladium, and the Mallorcan-based Grupo Piñero and Riu, which all generated gross margins of more than 20% during the last financial year.

The chain owned by the Matutes family is the second in the ranking after obtaining an estimated gross margin of 28.6% on its sales in 2016; it is followed by the group owned by the Piñero family, which includes the Bahía Príncipe and Soltour businesses, with a gross margin of 24.2%; and the chain owned by the Riu family, with a gross margin of 23.8% and the leader of the ranking by EBITDA.

Completing the Top 5 is another large chain and another Catalan firm: H10, which recorded a gross profit on its sales of 19.8% in 2016, followed by Grupo Barceló, with a gross margin of 14.2%, which would have been greater if it did not include in its sales the intermediation activity of Ávoris, which generates higher volumes but lower margins.

After Group Barceló in the ranking comes Grupo Iberostar, which comprises Almundo and World2Meet; and then the hotel groups NH and Meliá, which all exceeded or equalled a gross profit of 10% of sales in 2016. After those companies come the Canarian firm Lopesan and the Catalan firm Hotusa, which groups together Keytel and Restel, with similar gross margins of around 9% over sales.

A vertically integrated tourism group: an airline, a travel agency and a bed bank follow them in the ranking. At number 12 is Globalia, the parent company of Air Europa and Halcón Viajes, with a gross margin of 3.8% of sales, followed very closely by Iberia (3.7%) and Viajes El Corte Inglés (2.4%). The B2B firm Hotelbeds appears in fifteenth place with an estimated gross margin of 2% in 2016, a year when it had not yet completed the purchase of Tourico and GTA, the first of which generates significant EBITDA.

In this way, according to the ranking prepared by the leading tourism website, the chains with the greatest presence in the Caribbean and those dedicated exclusively to resorts are those that generate the greatest gains with respect to their revenues. Meanwhile, the conglomerates that also include intermediaries would have higher gross margin figures if they only reflected their hotel businesses, given that although they invoice less, they are more profitable.

Original story: Preferente (by Andrea Bulla)

Translation: Carmel Drake

Catalonia Hotels’ Revenue Rises By 12% To €413M In 2016

8 February 2017 – Expansión

The hotel chain Catalonia Hotels recorded revenues of €413 million in 2016, which represented an increase of 12% with respect to the previous year. It also increased its EBITDA, by 15%, to €125 million.

Catalonia Hotels, which is owned by the Vallet family, is one of the most important hotel companies in Cataluña, with a portfolio comprising 66 establishments. The group focuses its growth primarily in Europe and the Caribbean. Last year, it invested €23 million remodelling some of its hotels and it plans to spend a similar amount this year.

Original story: Expansión

Translation: Carmel Drake

Palladium To Invest €450M In New Openings & Renovations

23 January 2017 – Cinco Días

Palladium, the hotel group controlled by the Matutes family, is planning to invest more than €450 million in new openings and renovating its existing establishments, both in Spain as well as in the Caribbean.

The hotel chain, which recorded a turnover of €558 million in 2016, up by 14% compared to the year before, said that it had completed a good year. It also appeared optimistic about the performance of the holiday market in Spain this year, especially in the Balearic Islands, where it has a larger market share.

Abel Matutes Prats, CEO of the company, said that the firm’s growth strategy in terms of number of hotels now involves managing establishments owned by third parties. “We are ready to grow quite a lot in the urban and holiday segments as a hotel manager”, he said.

The company, which has signed an agreement with Hard Rock to bring the hotel brand to mainland Spain – the US firm already has two establishments on the islands, one in Ibiza and another in Tenerife – acknowledges that it has some plans on the table that have not been finalised yet. Not so long ago, Hard Rock was mentioned as the best positioned player to manage the hotel in Edificio España in Madrid.

“There are a couple of hotels in the pipeline, but nothing has been decided yet”, said Matutes Prats, who defends this alliance as “a well-matched marriage”, which is choosing to focus on its latest addition, the opening in Tenerife, at the moment, but which is not ruling out future developments in urban destinations.

The businessman highlights the arrival of Palladium in Asia. “One day we will have to make the jump, but right now it does not form part of our plans. When we move over there, it will be to launch something big”, he said.

Original story: Cinco Días (by L.S.)

Translation: Carmel Drake

Meliá Generates Profits Of €45M In H1 2016

2 August 2016 – Expansión

The hotel chain earned €45 million during the six months to June and reduced its net debt by €213 million.

The hotel chain Meliá, which will join the Ibex next week, replacing FCC, doubled its profits during the first half of the year, to €45 million. The company has highlighted that the 123% improvement in net profit has been generated even without the sale of any assets.

The company owned by the Escarrer family increased its average revenue per room (RevPAR) by 9.4% – or by 14.2% if we include the assets under management in its portfolio – and whereby recorded six years of consecutive quarterly increases.

The company closed the first half of the year with operating income of €856 million, 0.4% lower than in the same period in 2015. If we strip out the effect of gains from the sale of assets last year, operating income increased by 5.7%.

By geographic region, RevPAR in America was lower in H1 2016 than in H1 2015, which the company explains was due to the impact of the depreciation in the Canadian dollar, the economic deceleration in Brazil and Argentina, changes in reservations due to the Zika virus and the good temperature in the USA and Canada, the main issuing markets. By contrast, the company highlighted the strong performance of hotels in the Mediterranean and Caribbean, with a RevPAR increae of 30.9%.

In terms of the financial situation, Meliá decreased its net debt by €213 million during the first six months of the year, bringing it down to €556 million at the end of June, thanks primarily to the early conversion of a convertible bond issued in 2013.

The Vice-President and CEO of Meliá, Gabriel Escarrer Jaume, stated that the repositioning of its hotels, investment in assets and strategic markets, as well as financial strengthening have allowed the group to return to the Ibex thirteen years later.

The company is “optimistic” about the performance of its hotel complexes during the third quarter and its urban hotels during the second half of the year. In the same way, it forecasts a favourable “albeit unequal” performance across its “European hotels”, influenced by the world environment, especially France, in the face of the heightened terrorist threat. In terms of America, the firm expects a boost with the opening of several new hotels: Innside New York Nomad, ME Miami and Meliá Braco Village (Jamaica).

At a conference with analysts, the company made reference to Brexit explaining that it does not expect any impact in the short term, given that Britons have already booked their holidays for 2016, and some have even booked for next year.

Original story: Expansión

Translation: Carmel Drake

Barceló Will Acquire 100% Of Occidental

17 June 2015 – Cinco Días

Barceló Corporación Empresarial has signed an agreement with BBVA to acquire the remaining 57.5% stake in Occidental Hoteles Management, which would turn the Mallorcan hotel group, the current holder of 42.5% of the hotel chain, into the sole owner of the company.

In a statement, Barceló reported that the operation is subject to the necessary authorisation being granted by the competition authorities in Mexico. It also said that the addition of Occidential to its portfolio represented “a very significant step” in its growth strategy in Latin America.

As soon as this procedure has been completed, which is expected to take around three months, Barceló will acquire 100% of Occidental’s shares and will begin to manage the properties.

On 4 May, Barceló purchased a 42.5% stake in Occidental Hoteles, from the company’s minority shareholders….The option of acquiring 100% of Occidental’s capital was something the Mallorcan hotel group had in mind at the time. (…)

Through the acquisition of Occidental Hoteles, the Mallorcan tourism group would strengthen its position in the Caribbean with new properties in Mexico and the Dominican Republic. It would also gain a foothold in new countries such as Aruba, Colombia and Haití. (…)

Original story: Cinco Días

Translation: Carmel Drake

Barceló Acquires 42.5% Stake In Occidental Hoteles

5 May 2015 – Expansión

42.5% shareholding / The tourism group acquires the stakes held by Amancio Ortega, owner of Inditex, and several minority shareholders, and continues to negotiate with BBVA to take control of the chain.

The sale of Occidental Hoteles has been unblocked with Barceló’s purchase of a share of its capital. The tourist group has acquired a 42.5% stake from Amancio Ortega, owner of the textile empire Inditex, and several minority shareholders. In parallel, it is also negotiating with BBVA, which controls the remaining 57.5%, to gain control of 100% of Occidental and strengthen its position in the Caribbean.

Although the exact amount of the transaction is unknown, it has been closed with a discount of between 40% and 50% with respect to the €700 million that BBVA and Ortega paid in 2007. That was the figure that the shareholders hoped to obtain through the divestment process launched in 2013, which was thwarted last December, with Barceló as the favourite, due to differences over price.

Then, Barceló was bidding together with the fund Caribbean Property Group (CPG). Now, the tourism group is going to single-handedly undertake the purchase of the shares held by Ortega (who holds 23.63% through his company Partler 2006), Gregorio de Diego (who controls 13.5% through Tamar International) and the Miarnau family (whose company Iosa Inmuebles holds 5.26%).

Competition

The transaction, which is pending approval by the Mexican competition authorities, will be structured as a financial investment, and so Barceló will not take over the management of Occidental’s hotels. The chain operates 13 properties in the Caribbean and owns the majority of those establishments.

Nevertheless, sources in the sector are convinced that BBVA will end up selling a non-strategic stake. In fact, that is the joint position that the entity chaired by Francisco González and Amancio Ortega held until the end of 2014. The only thing that has separated them has been the timing (of their respective exits).

The textile businessman wanted to accelerate his exit from Occidental before the company looses value, since there is no growth plan on the table. In contrast, BBVA was keen to wait for a better offer and set a limit below which it was not willing to divest. In the end, the partners have broken their shareholders’ agreement, which has opened the door to Occidental for Barceló.

In terms of convincing BBVA, the close ties that unite the companies work in the tourism group’s favour. Barceló, BBVA and FCC created an asset company Grubarges in 1998, with the aim of channelling its surplus investors and growing in the hotel sector. Grubarges was dissolved in 2004 due to strategic differences between the partners, but the relationship is still strong.

If Barceló acquires 100% of Occidental, it will strengthen its position in the Caribbean, one of the priorities on its roadmap to become the world leader in the holiday hotel sector. Through the integration, Barceló would obtain a presence in new countries – Colombia, Aruba and Haití – and would strengthen its position in the Dominican Republic, Mexico and Costa Rica. Furthermore, the transaction would involve an investment plan to reposition Occidental’s properties.

Barceló currently operates 94 hotels and 30,000 rooms in 16 countries. In 2014, the company generated profits of €46.4 million, up 85.6% and turnover of €2,056.6 million, up 6.2%.

Original story: Expansión (by Yovanna Blanco)

Translation: Carmel Drake

Barceló Doubled Its Profit In 2014 To Generate c. €50m

12 February 2015 – Expansión

Barceló recorded a profit of c. €50 million in 2014, whereby doubling its result from the previous year. The co-chairman of the hotel chain, Simón Pedro Barceló announced the result yesterday (the group’s definitive results for the year are still pending) and attributed the increase to “a significant increase in EBITDA (from €183 million to €215 million) and the incorporation of ten new hotels in Mexico and the Dominican Republic. Moreover, 2014 was the first full year to include the results of its new travel division.

Turnover exceeded €2,000 million, of which €1,100 million was generated by the travel sector and €900 million from hotels. The total figure amounted to €1,800 million in 2013. The co-chairman of Barceló said that it is too soon to say how the tourism sector will evolve over the course of the year, but he noted that “the Caribbean and Mexico have had a strong start to the year and although we do not know what will happen during the summer months, we believe that we will outperform the results recorded in 2014 by 10%”.

According to the latest information released by the Mallorcan company, Barceló has 140 hotels in 17 countries containing 37,380 rooms. Half of them are located in Europe and the remainder are in America, primarily in the US and the Caribbean. It also has 400 travel agencies operating in 22 countries.

New acquisitions

The group, which returned to the travel agency segment last year through its acquisition of Orizonia, together with Globalia, has not ruled out growth through further acquisitions. Yesterday, Simon Pedro Barceló confirmed that “new corporate transactions have not been ruled out” in the travel agency sector.

The family business owns 39% of its hotels outright, and leases or manages the remainder. Its goal is to be “a great hotel company”, said Barceló yesterday, which is why the company is continually adding new hotels to its portfolio. “We have just signed an agreement to lease a new 4 star hotel with 250 rooms in Berlin”, he said.

Barceló, who was giving a lecture at ESADE, was very optimistic about the future of the economy and the tourism sector in particular and encouraged employers to work together with entities that are independent and able.

Original story: Expansión (by Marisa Ángeles)

Translation: Carmel Drake