PAI Partners Submits a €1.5bn Binding Offer for Catering Specialist ‘Áreas’

24 April 2019 – El País

The French group Elior has received a binding offer amounting to €1.542 billion from the investment group PAI Partners for Áreas, the company specialising in catering services located in travel areas and headquartered in Spain. The aim of the two parties is to close the operation this summer.

The Spanish group recorded revenues of €1.832 billion last year, making it the third largest concessions brand in its sector in the world. It will gain operational autonomy as a result of the sale.

Áreas operates in fourteen counties around the world – it is the market leader in Spain (27% market share), France and Portugal, and the third largest operator in the USA. Its 21,000 employees work in 90 airports, 84 train stations and 220 roadside service stations.

The objective of PAI Partners is to support and finance Áreas’s growth plans over the next few years.

Original story: El País (by Dani Cordero)

Translation/Summary: Carmel Drake

B&B Sells another Hotel in Spain to the fund Corum for €6.6M

22 January 2019 – Expansión

The French hotel chain B&B Hotels – owned by the fund PAI Partners – has sold a hotel in Viladecans (Barcelona) to the French fund Corum for €6.6 million. It is the chain’s largest hotel in Spain, with 216 rooms.

This operation follows the sale of eight hotels that the company completed last year, also to Corum. Like it did then, B&B is going to continue operating the latest asset under a rental arrangement for at least 15 years. Following the sale, B&B owns just two hotels in Spain, in Oviedo and Barcelona (…).

B&B now operates 30 establishments in Spain and plans to continue growing its portfolio in the country during 2019. Its hotels in the country are owned by funds, Socimis and family offices, such as Corum, Atom, Covivo, Doalca and Azata.

Original story: Expansión (by R.A.)

Translation: Carmel Drake

B&B to Open the First Hotel in Valdebebas

29 October 2018 – Expansión

The hotel chain B&B Hotels – owned by the fund PAI Partners – is arriving in Valdebebas with the objective of opening the first hotel in that urban development to the northeast of Madrid in 2021.

To this end, the French chain has signed an agreement with Filasa, the owner of the land on which the establishment will be built, for the rental of the plot in Valdebebas for a minimum period of 10 years.

Two buildings are going to be constructed on the plot, which has a buildable surface area of 8,000 m2. The first, which will span a surface area of 4,400 m2 and be shaped in a stepped-structure, will house the 150-room hotel. The second, which will span 3,200 m2 and take the form of a cube, will be used for offices. This property will also have a premise measuring 400 m2.

Original story: Expansión (by R. Arroyo)

Translation: Carmel Drake

ICG Buys Spanish Nursing Home Leader From PAI Partners

16 June 2017 – Expansión

Intermediate Capital Group (ICG) is holding exclusive negotiations with PAI Partners to purchase the majority of the capital in HomeVi, a company that owns more than 300 nursing homes in Spain and France.

The British investment fund ICG already holds a minority stake in HomeVi, in which the French businessman Yves Journel also owns shares. The operation, which would value the group at around €2,000 million, would see ICG buy the French private equity firm PAI Partners’ majority stake. Journel would continue as a minority shareholder.

HomeVi is the leader in the nursing home sector in Spain through Geriatros-SARquavitae, which groups together 135 centres with 20,000 beds. PAI Partners bought Geriatros from Magnum Capital through HomeVi in 2015 for around €300 million; and in February this year, it acquired SARquavitae, which was previously controlled by the British fund Palamon, for €440 million. In that transaction, Euro Lagune acquired the real estate assets of SARquavitae for €110 million.

For the overall valuation of HomeVi in the negotiations with ICG, the Spanish activity accounts for almost half of the total. In France, the group operates under the DomusVi brand, and it also has several centres in China.

Two months ago, PAI Partners engaged the investment bank Rothschild to advise it on the possible sale of HomeVi. After analysing its debut on the stock market, it seems to have opted for a rapid sale process in the end, given the interest from ICG.

This fund, with assets worth €23,800 million, has traditionally invested in debt to finance private equity firms. Now it is diversifying to buy companies directly. Last year, ICG invested around €200 million to take control of the La Rioja-based industrial company Garnica.

Original story: Expansión (by Roberto Casado)

Translation: Carmel Drake

B&B Sells 8 Hotels In Spain To Corum For €30M

19 May 2017 – Expansión

The hotel chain B&B Hotels and the investment fund Corum have reached an agreement to allow the former to divest the assets that it owns in Spain, whilst continuing to manage them, and the latter to strengthen its presence in the country with the purchase of eight hotels.

According to the terms of the agreement, B&B will sell the establishments to Corum for €30 million, although it will continue to operate them under a lease arrangement for at least 15 years. The hotels included in this operation are located in Figueres, Girona, Granollers, Mollet, Viladecans, Valencia, Albacete and Fuenlabrada.

The two groups also plan to explore new opportunities to collaborate in Spain and Portugal during 2017.

B&B Hotels, owned by the fund PAI Partners, operates 20 hotels in Spain after it purchased the low-cost chain Sidorme last October. The French hotel group, which tripled its turnover in Spain in 2016, to exceed €20 million, wants to double in size in the country within three years and is evaluating its expansion into Portugal.

Meanwhile, the real estate investment fund Corum, which manages more than €1,300 million in assets across Europe, is planning to invest more than €450 million in various European countries, including Spain, in 2017.

Corum made its debut in Spain in 2013 with the purchase of a commercial property in Tarragona. This is the sixth operation that the fund has completed in the country.

For Jairo González, CEO of B&B Hotels in Spain and Portugal, this operation allows the chain to “lighten the load” on its balance sheet in Spain to be able to incorporate more hotels into its network.

Philippe Cervesi, Director of Investment at Corum, said that the agreement reflects Corum’s capacity to find “interesting assets, with a good return and excellent guarantees, in an attractive market such as Spain”.

Original story: Expansión (by Rebeca Arroyo)

Translation: Carmel Drake

B&B Hotels Plans To Double In Size By 2019

26 January 2017 – Expansión

B&B Hotels is putting its foot down on the accelerator in Spain and wants to double its size in the country over the next three years. The French hotel group, which is owned by the private equity fund PAI Partners, currently operates 20 hotels in Spain following its purchase of the low-cost chain Sidorme last October. It is planning to grow its portfolio to 40 hotels by the end of 2019, according to Jairo González, CEO at B&B Hotels for Spain and Portugal.

“PAI Partners have owned B&B Hotels since March 2016 and they expressed their interest in Sidorme immediately”, said the Director. B&B Hotels has operated four hotels in Spain since 2015 and added 15 assets to its portfolio last year through the purchase of Sidorme. Moreover, in January, the chain incorporated a new hotel in Vigo.

The private equity fund’s commitment to Spain is “clear”. “The idea is to open five hotels this year and to commit to opening another five in the future. Our plan is to open 20 more hotels between now and the end of 2020, which would mean doubling our current operations”, said González.

Moreover, the company wants to make its debut in Portugal. “It is a very interesting market and it is perfect for a product such as ours. We want to open our first hotel in the country during 2017”.

Last year, the company recorded turnover of more than €20 million in Spain and an EBITDA of more than €5 million, which represented a two-fold increase compared to the previous year. “The forecast for this year is to achieve growth of between 20% and 30%. Our size still allows us to do that”, said González.

And he added: “Rapid growth generates a certain degree of chaos, which, if channelled in a productive way, permits a very positive vibrant effect, but, otherwise, is self-destructive”.

The company’s plans also include selling the owned hotels it inherited from Sidorme – eight of the twenty assets in its current portfolio – to focus on the management of its assets. The company manages almost 3,000 rooms with a RevPAR (average revenue per available room) of around €30.

In terms of the tourist apartment business line, the company will analyse any new opportunities that fit with its strategy. “We see this business as an opportunistic option. If we come across operations such as the one on Calle Fuencarral, 46 (in Madrid), we will be delighted to proceed, but we are only interested in buildings that are close to existing hotels so that they can complement the existing products”, added the Director.

Sidorme currently operates apartments on Calle Fuencarral, 46, which are located just a few metres from a Sidorme hotel on the same street.

Original story: Expansión (by Rebeca Arroyo)

Translation: Carmel Drake

B&B Hotels Takes Control Of Hotel Group Sidorme

20 October 2016 – Expansión

The French hotel chain B&B Hotels, controlled by the French private equity firm PAI Partners, has acquired the Spanish group Sidorme, which has 1,367 rooms across 15 establishments in Spain.

With this operation, B&B Hotels now controls 19 establishments in Spain. The French group already owned four hotels in Valencia, Alicante, Madrid and Gerona, and plans to open a fifth, in Vigo, at the end of 2016.

The Sidorme brand will disappear and will be absorbed by B&B, which is more widely recognised and has a strong international presence. B&B Hotels manages and operates almost 370 hotels in France, Germany, Italy, Spain, Poland, Czech Republic and Morocco.

The head of Sidorme until now, Jairo González, who has purchased a minority “but significant” stake in the hotel chain, will be the CEO of B&B in Spain and Portugal.

The Director has explained that the company plans to enter the Portuguese market soon and grow at double digits over the next three years.

The hotel group expects to increase its sales by 49% in 2016, to exceed €15 million. The company, which increased its sales by 45% in 2015, to more than €10 million, tripled its profits during the same period, to generate a net profit of more than €1 million. “The aim is to achieve cumulative EBITDA growth of 30% over the next three years and to double the size of the hotel chain”, said González.

Sidorme was founded in 2014 by fourteen family offices from across Spain, including the New Windows Group, the Del Castillo family, José Manuel Loureda and the Sansalvadó family, who invested around €25 million in total.

Original story: Expansión (by Rebeca Arroyo)

Translation: Carmel Drake

VPS Seeks Local Partners To Boost Growth In Spain

21 July 2016 – Expansión

The vacant building manager VPS (Vacant Property Specialists), which is headquartered in London and which has been controlled by PAI Partners since 2014, has set its sights on Spain to target its growth. The multi-national company, which has been managed by David Taylor-Smith since May of this year, recorded turnover of €300 million in 2015 and considers that the Spanish market has the most potential for growth in Europe. It has prepared a plan to position VPS as the market leader in the country. Moroever, at the international level, it plans to triple its revenues over the next four years.

The company has hired Oscar Aragón to be its new CEO in Spain – he has previously worked for firms including Compass Group, Sotkon, ISS and Gas Natural – with the aim of making VPS the market leader.

According to Aragón, “until now, no companies in Spain have been dedicated exclusively to the management of vacant properties”. And, yet, there is significant demand for these types of services, “given the volume of assets that are still owned by the banks and that are not being used, for example”, explained the executive.

Property developers also require their services: “In a property development, if there are squatters, even in just one of the properties, then it makes it very difficult to sell the rest”. The disused buildings and homes may be closed, sealed off or protected “in a rudimentary way” or under the supervision of a professional company. In addition, he added, many financial institutions and large real estate companies prefer to work with a single company that can handle all of their properties across the whole of Spain, rather than with small local firms.

The headquarters of VPS’s Spanish subsidiary is located in Cornellà de Llobregat (Barcelona) and the firm also has offices in Madrid, Sevilla and Valencia. Aragón said that the company’s growth plans include opening offices in at least twelve provincial capitals, as well as increasing the workforce from its current size (50 people) to 150 within the next year.

Its aim is to grow both organically and through the acquisition of small companies. “We can expect to see a process of consolidation in the sector”, predicted the executive.

Original story: Expansión (by M. Anglés)

Translation: Carmel Drake

French Chain B&B Opens 4 Hotels In Spain

8 July 2016 – Expansión

The French hotel chain B&B, one of the largest in Europe with a network of 321 establishments and annual revenues of €344 million, has started to expand its business into Spain. A few months ago, it opened its first four hotels here, all of which used to be owned by the Holiday Inn, in Valencia, Madrid, Alicante and Gerona, for a total investment of €14 million. It plans to open at least four hotels a year between now and 2020, with an average investment of around €5 million per property, which represents a total investment of approximately €80 million over the period.

The next hotel opening will be in Vigo, planned for December. B&B, which was acquired by PAI Partners in December, is establishing itself under two systems: the construction of buildings and the acquisition of existing hotels. The four Spanish hotels, which used to house Holiday Inns, were acquired and then transferred to the firm Foncier des Murs, owned by the Crédit Agricole group, which is the company’s financial partner for these types of investments and which itself owns 250 hotels that B&B operates.

The hotel in Vigo will follow the same pattern; meanwhile the company is looking for other opportunities to buy and construct hotels. The Director of B&B in Spain, Dennis Darrien, explained that the company has plans to construct one hotel in Barcelona, in the 22@ district, but that those plans are on hold due to the hotel moratorium established by the Town Hall.

The company is looking for hotels with between 80 and 150 rooms, in good locations.

B&B was created in 1990, as a chain for business travellers in France – where it now has 250 hotels, some of which it owns and others which it leases – with low cost prices. The CEO of the Group, George Sampeur, explained that in Spain they will also target the tourist market, given the nature of the country.

The company has eighty hotels in Germany, twenty-three in Italy, three in Poland, one in the Czech Republic and another in Morocco. It plans to expand to Latin America by opening its first hotel in Brazil, in Sao Paulo, before continuing to Curitiba and other areas in the south of the country.

In total, according to its business plan, B&B plans to open thirty hotels a year between now and 2020.

Original story: Expansión (by J. Brines)

Translation: Carmel Drake

Four Investors Compete In CaixaBank’s Nursing Home Sale

20 May 2016 – Expansión

There are four players in the race to purchase the Amma residences. The private equity giant Pai Partners and the Maison de Famille, Emera and Armonea groups are the candidates that have made the first cut in the acquisition process and, therefore, will battle the critical bid to acquire the nursing homes and day centres controlled until now by CaixaBank, according to sources familiar with the process.

The four investors have already performed detailed due diligence of the assets with a view to presenting a binding offer, say sources in the market, and they have until “next week” to submit their final proposals. The initial prices valued the nursing homes at around €200 million.

This amount represents just over ten times the company’s EBITDA in 2015, which amounted to €18 million, according to industry estimates. Meanwhile, its total revenues amounted to almost €100 million. Although CaixaBank is the owner of almost 70% of the shares, the sale affects 100% of the capital, because the minority owners (the Caja Duero corporate business group, Grupo Norte, Inverduero, Kintoa, Uve, Bella Castilla and Horizontes de Castilla) are also willing to transfer their stakes, according to financial sources.

Given the identity of the potential investors, industrial players are prevailing in the transaction, which was launched at the beginning of the year. The majority of the candidates of a financial nature who participated in the sales process – which included the fund Permira, amongst others – have been excluded, and all of the parties involved in the final round of bidding have prior experience in the sector. (…).

Consolidation in the sector

The sale of the Amma Group, which is scheduled to be closed before the summer, is another sign that the effervescence of transactions in the nursing home sector in Spain is continuing to peak.

Last year, three significant operations were closed: as well as the sale of Geriatros (to Pai Partners), SARquavitae purchased Novaire and the Spanish private equity fund Portobello took control of Vitalia Plus. So far in 2016, BBVA is immersed in a process to sell off Sanyres. And financial sources confirm that Gala Capital has begun the divestment of Geroresidencias La Saleta, a company that it inherited from the portfolio of Ahorro Corporación’s private equity manager.

The appeal of the nursing home sector, whose total turnover amounts to €4,000 million per year, is due to the rosy forecast for revenue growth that the accelerated aging population is causing and the shortage of available places in care centres for the elderly. The possibilities for consolidation that results from the fragmentation of this market is another significant factor that is stirring up the industry.

The Amma Group, with a staff of 2,800 professionals, manages 30 nursing homes and 27 day centres in Spain, with the capacity to serve more than 5,500 users across eight autonomous regions: Madrid, Cataluña, Navarra, Castilla y León, Castilla-La Mancha, the Canary Islands, Cantabria and Murcia.

Original story: Expansión (by Mamen Ponce de León)

Translation: Carmel Drake