Barely a week after Taj Hotels and Palaces unveiled its strategic alliance with Shangri-La Hotels and Resorts, the hospitality sector is now abuzz with the announcement of a S$24 million (US$16.9 million) partnership between Banyan Tree Holdings and AccorHotels to jointly develop and manage Banyan Tree branded hotels around the world.
This investment will be made through a mandatory convertible debenture that at conversion will give AccorHotels a stake of about five per cent in Banyan Tree. AccorHotels has an option to purchase an additional stake of about five per cent.
Banyan Tree Lijiang
Under this long-term partnership proposed under a heads of agreement, Banyan Tree will also have access to AccorHotels’ global reservations and sales network, as well as its loyalty programme Le Club AccorHotels.
Ho Kwon Ping, executive chairman of Banyan Tree, said: “This agreement is not only transformational for Banyan Tree, but is also an innovation for the global hospitality industry. With the current consolidation of mega hotel companies, smaller but also global players – many family-controlled – are also seeking strategic alliances with the global giants.
"Our strategic alliance with AccorHotels allows us to remain an independent company, enabling us to continue securing hotel management agreements on our own and yet accelerating Banyan Tree's speed and scope of expansion but with AccorHotels helping us to grow our brands around the world."
Sebastien Bazin, CEO and chairman of AccorHotels, said: “Our collaboration with Banyan Tree is a great opportunity to complement our business proposition to owners with iconic brands, while always better servicing our guests.
"We will bring scale to the network through our ability to develop and manage hotels under the Banyan Tree brands globally, hence strengthening our leadership in the luxury hotel space. We are confident that our investment will create incremental value for our shareholders."