Marriott completes Protea acquisition
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Marriott International has finalised a deal to acquire South African hotel company, Protea Hospitality.
Following an initial agreement announced in November 2013, the companies have now signed definitive agreements for the purchase of Protea’s three brands and management company.
Under terms of the deals, Marriott will pay approximately ZAR2.02 billion (US$186 million) to take control of Protea’s management business, which currently consists of 116 hotels, with an inventory of more than 10,000 rooms in South Africa and six other Sub-Saharan African countries.
The acquisition will nearly double Marriott’s portfolio in Africa to more than 23,000 rooms.
As part of the transaction, Protea will create a new company to retain control of its owned hotels, and will enter into long-term management and leasing agreements with Marriott for these properties. This property ownership company will also retain a number of minority interests in other Protea-managed hotels.
“Protea Hotels enjoys unparalleled brand recognition in Africa, and our combined portfolio of Protea Hotels and current Marriott International brands would create a platform for accelerated growth and new job growth in South Africa and across the continent,” Marriott’s president & CEO, Arne Sorenson, said when the deal was first announced.
At the close of the deal, Marriott will manage approximately 45% of Protea’s rooms, franchise 39% and lease 16%.
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