LVMH Moët Hennessy Louis Vuitton (LVMH.PA) is increasing its footprint in the ultimate hospitality market with the acquisition of Belmond Ltd.
LVMH and Belmond have issued a joint announcement that they had entered into a definitive agreement for LVMH to acquire Belmond for $25.00 per Class A share in cash. This represents an equity value of $2.6 billion in a transaction with an enterprise value of $3.2 billion. In the twelve months ended September 30, 2018, Belmond recorded total revenues of $572 million and adjusted EBITDA of $140 million. The transaction is expected to complete in the first half of 2019 subject to the approval of Belmond’s shareholders and clearance by the relevant competition authorities.
Roland Hernandez, chairman of the Board of Directors of Belmond Ltd., said: “Following a strategic review that attracted broad and deep interest from a wide range of reaestate and lodging companies, sovereign wealth institutions and other financial buyers around the world, the board concluded that this transaction with LVMH provides compelling and certain value for our shareholders as well as an exciting path forward with a group that appreciates Belmond’s irreplaceable assets and strong management team.”
Bernard Arnault, chairman and CEO of LVMH, commented: “Belmond delivers unique experiences to discerning travellers and owns a number of exceptional assets in the most desirable destinations. Its heritage, its innovative services, its excellence in execution and its entrepreneurship resonates well with the values of the Group and is complementary to our own Cheval Blanc maisons and the Bvlgari hotels activities. This acquisition will significantly increase LVMH’s presence in the ultimate hospitality world.”
Established over 40 years ago with the acquisition of Hotel Cipriani in Venice, Belmond owns and operates 46 hotel, river and river cruise experiences in 24 countries. In addition to the Hotel Cipriani, iconic properties in the portfolio include Hotel Splendido in Portofino, Copacabana Palace in Rio de Janeiro, Le Manoir aux Quat’Saisons in Oxfordshire, Grand Hotel Europe in St. Petersburg, Maroma Resort & Spa in Mexico, Hotel das Cataratas in the Iguassu National Park in Brazil, and Cap Juluca in Anguilla.
Legendary trains, such as the Venice Simplon-Orient-Express and Belmond Royal Scotsman and exceptional cruises such as Belmond Afloat in France fleet and Belmond Road to Mandalay, complete the portfolio.