Europe's second-biggest hotel operator has a new owner. U.S. investment group Starwood Capital is selling the Louvre Hotels Group to Shanghai's Jin Jiang International Holdings in a deal that is reportedly around $1.5 billion.
The Louvre Hotel Group has more than 1,100 hotels in 47 countries, and is composed of both luxury and budget hotels, such as Kyriad, Campanile and Royal Tulip. Jin Jiang is one of China’s biggest hotel groups, operating more than 1,700 hotels in 11 countries.
“There is strong complementary synergy between Louvre Hotel and Jin Jiang in brand portfolio, geographic footprint and guest base,” YU Mingliang, chairman of Jin Jiang, said in a statement. The deal is expected to close in the first quarter of 2015.
Starwood Capital bought the Louvre Hotels Group in 2005 for $3.2 billion when it was called Societe du Louvre. In 2013, it sold four of the high-end luxury hotels run by Louvre Hotels Group to Luxembourg-based Constellation Hotels Holding Ltd.
Louvre Hotels and Jin Jiang already had a long-standing relationship. In 2011, the two companies established a co-branding program in France and China to boost tourism between the two countries.
The deal is a blow to France's Accor, which reportedly was also in the running to acquire Louvre. Had it won out, it would only further boost its position in Europe's budget sector.
The deal comes on the heels of another Chinese company buying big outside its home base. Last month, Chinese firm Anbang Insurance Group agreed to buy the Waldorf Astoria hotel in New York City from Hilton Worldwide for $1.95 billion.
Also recently, Hong Kong-based investor Kai Yuan Holdings bought the Paris Marriott Hotel Champs Elysees for a reported $468 million.