Accor SA (AccorHotels) has proposed a full $A1.2 billion takeover of Gold Coast-based hotelier Mantra Group Ltd, and on Thursday the Mantra board said it would recommend acceptance.
Mantra has a portfolio of 125 Peppers, Mantra & BreakFree hotels & resorts in Australia, New Zealand, Indonesia. & Hawaii. 11 are in New Zealand.
Image above: The Peppers Beacon in Queenstown.
Accor has 34 hotels in New Zealand and one more, the So Sofitel Auckland on Customs St, due to open in the first quarter of 2018. They’re under the Sofitel, Pullman, MGallery, Mercure & Grand Mercure, Sebel, Novotel & Ibis brands.
Mantra’s board said it had entered into a binding agreement for Accor to acquire all the shares of Mantra at $A3.961 cash/share (on a fully diluted basis – an A6c/share final dividend has just been paid), including a potential special dividend, by way of a scheme of arrangement.
Customary conditions include approval by the Federal Court of Australia and regulatory approvals, including from Australia’s Foreign Investment Review Board and the Australian Competition & Consumer Commission.
Mantra shareholders will get a scheme booklet in February. The meeting to vote on the proposal is expected to be held in March, enabling the scheme to be implemented by the end of March.
The cash consideration represents an implied market capitalisation of $A1.18 billion and an implied enterprise value of $A1.25 billion for the June 2017 year, on a fully diluted basis.
In addition, Mantra will have the discretion to pay shareholders a special dividend of up to A23.5c/share, which will be deducted from the $A3.96 headline value.
Mantra’s board unanimously recommended the scheme.
The board said the price represented a 22.6% premium over Mantra’s closing price on 6 October, the last trading day before a possible deal was disclosed, 29.2% over the 30-day volume-weighted average, and 33.1% over the 90-day volume-weighted average.
It equated to an underlying 2017 financial year price:earnings multiple of 23.7x and an underlying EV/EBITDAI (enterprise value:earnings before interest, taxes, depreciation, amortisation & impairment) multiple of 12.4x, both of which the board considered attractive.
Mantra chair Peter Bush said it was an attractive outcome for shareholders, recognised the strategic value of the company’s business and its success in becoming a leading accommodation provider: “The offer represents compelling value and provides an attractive opportunity for shareholders to realise this value. AccorHotels has a global capability and deep skills that will benefit Mantra’s customers and provide opportunities for our team members.”
Accor chair & chief executive Sebastien Bazin said: “We have long admired the Mantra business, both in respect of its brands & properties as well as its people & processes. We will be looking to bring together the best of both companies to provide an enhanced experience for our customers & employees in what is an exciting period of growth of the industry in Australia & New Zealand.”
11 October 2017: AccorHotels puts control proposal to Mantra
Attribution: Company releases & websites.