Toronto -- Fairmont Hotels said today it has agreed to a $3.9-billion buyout offer from a joint venture consisting of Saudi Prince Alwaleed bin Talal and Colony Capital, which owns the Raffles luxury brand.
Expected to close in the second quarter, the deal will create a group of 120 hotels in 24 countries, including Fairmont's portfolio of 49 luxury hotels under the Fairmont brand and 38 upscale hotels under the Delta brand.
The sale comes at a time when competition in the luxury hotel segment is heating up. Earlier this month both Starwood Capital Group and Hilton Hotels announced new luxury brands.
'Fairmont and Raffles are an excellent strategic fit, with rich histories, global brand recognition, and complementary destinations,' said Colony Capital chief executive Thomas Barrack Jr. 'Joining the two luxury companies creates an ideal platform for continued international expansion.'
Colony Capital last year bought the Raffles brand, which includes Singapore's landmark Raffles Hotel. Raffles owns and manages a portfolio of 33 properties, including 23 Swissotels, located primarily across Asia and Europe. Fairmont's hotels are located mainly in North America.
Fairmont will remain an independent hotel management and ownership company, headquartered in Canada; and Raffles, based in Singapore, will also retain its independent brand identity, according to today's announcement.
Prince Alwaleed's Kingdom Hotels International owns interests in Fairmont Hotels and Four Seasons Hotels, among other lodging assets.
Expected to close in the second quarter, the deal will create a group of 120 hotels in 24 countries, including Fairmont's portfolio of 49 luxury hotels under the Fairmont brand and 38 upscale hotels under the Delta brand.
The sale comes at a time when competition in the luxury hotel segment is heating up. Earlier this month both Starwood Capital Group and Hilton Hotels announced new luxury brands.
'Fairmont and Raffles are an excellent strategic fit, with rich histories, global brand recognition, and complementary destinations,' said Colony Capital chief executive Thomas Barrack Jr. 'Joining the two luxury companies creates an ideal platform for continued international expansion.'
Colony Capital last year bought the Raffles brand, which includes Singapore's landmark Raffles Hotel. Raffles owns and manages a portfolio of 33 properties, including 23 Swissotels, located primarily across Asia and Europe. Fairmont's hotels are located mainly in North America.
Fairmont will remain an independent hotel management and ownership company, headquartered in Canada; and Raffles, based in Singapore, will also retain its independent brand identity, according to today's announcement.
Prince Alwaleed's Kingdom Hotels International owns interests in Fairmont Hotels and Four Seasons Hotels, among other lodging assets.