InterContinental Hotels Group has bought Six Senses Hotels Resorts Spas in a $300 million cash acquisition.
InterContinental Hotels Group announced today the acquisition of Six Senses Hotels Resorts Spas, one of the world’s leading operators of luxury hotels, spas and resorts.
The $300 million cash acquisition from asset management firm Pegasus Capital Advisors includes all of Six Senses’ brands and operating companies but does not include any real estate assets.
IHG, the owner of chains such as Crowne Plaza and Holiday Inn, says the deal, which takes IHG’s total portfolio of luxury hotels to 400 properties with 108,000 rooms, will beef up its luxury portfolio.
Under increasing pressure by competition from online rental services like Airbnb, the UK-based hospitality giant wants to re-focus on competing with the sprawling luxury portfolios run by Marriott and Hilton, the news agency Reuters reports.
“Six Senses is an outstanding brand in the top-tier of luxury and one we’ve admired for some time,” IHG’s chief executive Keith Barr said about the deal.
Last year, IHG also deepened its luxury presence by buying a 51% stake in the UK’s Regent Hotels and Resorts.
Six Senses currently manages 16 hotels and resorts, with 18 management contracts signed in its pipeline and more than 50 further deals “under active discussion”.
It runs properties in locations such as the Maldives, the Seychelles, Yao Noi in Thailand, Zighy Bay in Oman, Portugal’s Douro Valley and Ninh Van Bay in Vietnam whose Water Villas have been named the “sexiest hotel rooms in the world”.
Most recently, Six Senses Bhutan, a collection of five boutique lodges overlooking the little-visited mountain kingdom, opened its doors in October.
IHG says it expects to expand Six Senses, which generates fee revenues of over $13 million, to more than 60 properties globally over the next ten years. It expects a return in investment by the fourth year after the purchase.
“This acquisition continues the progress we’ve made against the strategic initiatives we outlined a year ago, which included a commitment to adding new brands in the fast-growing $60 billion luxury segment,” Barr explained.