AccorHotels Plans to Acquire Fairmont Hotels & Resorts
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The consolidation trend continues in the travel industry! Last month, we saw that Marriott would acquire Starwood Hotels – a TPG favorite. Last year, IHG acquired Kimpton – although Kimpton retained its reward program, Kimpton Karma Rewards, following the acquisition. And between the airline mergers, including American Airlines and US Airways (completed this year) and United and Continental (in 2012), the number of individual travel brands seems to be shrinking.
Today, AccorHotels announced that it plans to acquire the Fairmont, Raffels and Swissôtel brands, collectively FHRI. According to Reuters, Accor will pay for the acquisition by issuing 46.7 million new Accor shares and a cash payment of $840 million.
What exactly does this mean? FHRI has 155 hotels and resorts in its portfolio in 34 countries across five continents, including 40 properties currently under development. In an email to customers, FHRI stated that Accor “is a global leader in the travel industry with a diverse portfolio.” With the acquisition, FHRI noted that its customers will have a far greater number of properties in different locations to choose from in the combined portfolio after the deal is closed. Accor has more than 3,800 properties in 94 countries, including 20 recognized luxury, midscale and economy brands. The brand is lacking in its number of high-end, luxury properties, so the Fairmont acquisition will help in that regard.
The deal is expected to be complete in mid-2016, around the same time that the Marriott-Starwood merger is expected to close. Just like that merger, the announcement of the Accor-Fairmont deal hasn’t disclosed much information about the future of Fairmont’s President’s Club loyalty program. In an email to members, Fairmont said:
“While an exciting next chapter awaits, we want to let you know that today your membership in Fairmont President’s Club and any upcoming reservations including award redemptions remain unchanged, and as a loyal guest you will continue to enjoy all your current benefits and privileges when staying at Fairmont Hotels & Resorts.”
Currently, President’s Club members receive the basic treatment most other hotel loyalty programs offer: free internet, discounts to the spa, health club access and more. Keep an eye out for confirmed details on the status of the President’s Club loyalty program as the date for the close of the deal draws nearer.