7 Nov 2013 22:07 Africa/Lagos
Marriott Signs Letter Of Intent To Acquire Protea Hotel Group's Hotel Operations And Brands
Expects to Become Largest Hotel Company in Africa**
BETHESDA, Md.,
Nov. 7, 2013
/PRNewswire/ -- Marriott International, Inc. (NASDAQ: MAR) today said
it has signed a letter of intent with Protea Hospitality Holdings of
Cape Town, South Africa
to acquire Protea Hotels' brands and its management business that
operates or franchises 116 hotels across three brands with 10,184 rooms
in
South Africa and six other Sub-Saharan African countries. The transaction would nearly double Marriott's distribution in
Africa
to more than 23,000 rooms, and would also provide Marriott with a
proven operational platform and leadership team to accelerate Marriott's
expansion plans and solidify its leadership position in the dynamic and
growing African hotel market. [
Click here for images and b-roll.]
Protea Hotels, founded in 1984, manages, franchises and leases hotels
across the Protea Hotels brand (104 hotels), comprising a full and
diverse range of outstanding hotels and resorts; the award-winning
lifestyle boutique Protea Hotel Fire & Ice! brand (2 hotels); and
the superior deluxe African Pride Hotels collection (10 hotels). In
addition to its industry-leading 80 hotels in
South Africa, Protea Hotels has a significant presence in
Malawi,
Namibia,
Nigeria,
Tanzania,
Uganda and
Zambia.
As part of the transaction, Protea Hospitality Holdings would create a
property ownership company to retain ownership of the hotels it
currently owns (and enter into long-term management and lease agreements
with Marriott for these hotels). It would also retain a number of
minority interests in other Protea managed hotels. At closing Marriott
would manage approximately 46 percent of the rooms, franchise
approximately 40 percent of the rooms, and lease approximately 14
percent of the rooms.
Arne Sorenson, president and chief executive officer of Marriott International, said, "
Africa
has significant untapped potential for travel and tourism, both as a
destination and source of new global travelers. The continent's GDP is
anticipated to grow at over five percent annually over the next several
years which we expect will raise more people into the emerging middle
class. With the Protea Hotels acquisition, our expanded footprint should
allow us to become the first choice of
Africa's rapidly growing population of young, sophisticated travelers, and drive loyalty to our Marriott Rewards program both within
Africa and globally. Protea Hotels enjoys unparalleled brand recognition in
Africa,
and our combined portfolio of Protea Hotels and current Marriott
International brands would create a platform for accelerated growth and
new job growth in
South Africa and across the continent."
Alex Kyriakidis, president of Marriott International for the
Middle East and
Africa, said, "The development cycle for opening new hotels in
Africa
is typically long due to the challenges posed by emerging
infrastructure, so joining forces with Protea Hotels and their highly
respected management team is the strongest way to jumpstart Marriott's
footprint in Africa. The Marriott Middle East and
Africa
management team can deliver value and greater growth for Protea's hotel
owners by leveraging these terrific brands, represented by 116 hotels
and more than 10,000 rooms in seven countries, with Marriott's global
sales, marketing and development infrastructure. We believe this would
also result in more job creation in
South Africa and across the continent."
Arthur Gillis, chief executive officer of
Protea Hospitality Group, said "Protea Hotels has grown organically to
become the largest and leading hotel group in Sub-Saharan Africa.
Aligning with a global giant such as Marriott ensures we can realise the
Group's full potential for all of our stakeholders. In Marriott we have
found a perfect fit across culture, values and commitment to industry
leadership which will ensure that we remain at the forefront of African
hospitality."
The otherwise non-binding letter of intent includes provisions that
the parties will negotiate exclusively with each other. The transaction
is subject to completion of due diligence, negotiation and execution of
definitive documents, receipt of customary third party and governmental
consents and approvals and satisfaction of other customary conditions
for transactions of this kind that the parties expect will be included
in the definitive transaction documents.
The proposed terms of the transaction are not being disclosed at this
time. The parties stated that they plan to sign definitive agreements
by year-end 2013 and the transaction could close in the first three
months of 2014. In any event, Marriott does not expect the transaction
would have a material impact on its 2014 results.
About Marriott: Marriott International, Inc. (NASDAQ: MAR) is a leading lodging company based in
Bethesda, Maryland, USA, with nearly 3,900 properties in 72 countries and territories and reported revenues of nearly
$12 billion
in fiscal year 2012. The company operates and franchises hotels and
licenses vacation ownership resorts under 18 brands. For more
information or reservations, please visit our website at
www.marriott.com, and for the latest company news, visit
www.marriottnewscenter.com.
About Protea Hotels:
Protea Hotels is the largest and leading hotel group in
Africa with the most extensive footprint; more than 116 hotels throughout
South Africa and six other African countries, including
Zambia,
Nigeria,
Namibia,
Malawi,
Uganda and
Tanzania.
The company was founded in 1984 and has grown its portfolio and brands
since. The group comprises of two brands, namely the mid-up market
Protea Hotels (including the lifestyle brand Protea Hotel Fire &
Ice!) brand and the superior deluxe African Pride Hotels, Lodges and
Country Houses brand.
Protea Hotels is the winner of 2 World Travel Awards for Best Hotel Group in
Africa,
winner of 3 Sunday Times Markinor Top Hotel Brand Awards, the winner of
4 Coolest Hotel Group awards in the Sunday Times Generation Next
surveys and the winner of the Ask Africa South African Customer Service
Award 2013.
For more information or reservations, please visit our website at
www.proteahotels.com, and for the latest company news, visit
www.proteahotels.com/pressroom/Pages/pressroom.aspx.
Note on forward-looking statements
: This press release contains "forward-looking statements" within
the meaning of U.S. federal securities laws, including the parties'
plans for signing and closing on definitive transaction documents; the
resulting impact on the size of Marriott's operations in
Africa;
and similar statements concerning anticipated future events and
expectations that are not historical facts. We caution you that these
statements are not guarantees of future performance and are subject to
numerous risks and uncertainties, including the ability of the parties
to agree on definitive transaction documents, the receipt of necessary
consents, and other risk factors that we identify in our most recent
quarterly report on Form 10-Q. Any of these factors could cause actual
results to differ materially from the expectations we express or imply
in this press release. We make these forward-looking statements as of
the date of this press release. We undertake no obligation to publicly
update or revise any forward-looking statement, whether as a result of
new information, future events or otherwise.
Video with caption: "Protea Hotel African Pride." Video available at:
http://www.youtube.com/watch?v=nDTA1-urBF0
Image with caption: "Marriott signs letter of intent to acquire
Protea Hotel Group's Hotel Operations and Brands; Company expects to
become largest hotel company in
Africa." Image available at:
http://photos.prnewswire.com/prnh/20131107/MM13074-a
Image with caption: "Marriott signs letter of intent to acquire
Protea Hotel Group's Hotel Operations and Brands; Company expects to
become largest hotel company in
Africa." Image available at:
http://photos.prnewswire.com/prnh/20131107/MM13074-b
Image with caption: "Marriott International, Inc. logo." Image available at:
http://photos.prnewswire.com/prnh/20130531/PH23900LOGO
**Defined by STR Global as the total of
operating rooms and rooms under construction for Marriott International
and Protea Hotels
SOURCE Marriott International, Inc.
CONTACT: Tom Marder, (301) 380-2553, thomas.marder@marriott.com
Web Site:
http://www.marriott.com
