LVMH Moët Hennessy Louis Vuitton, an international leading luxury group and Belmond Ltd owners, part-owners and managers of 46 luxury hotel, restaurant, train and river cruise properties, jointly announced on December 17 that they have entered into a definitive agreement for LVMH to acquire Belmond.
LVMH is 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 12 months, ending September 30, 2018, Belmond recorded total revenues of $572 million and adjusted its earnings before interest, tax, depreciation and amortisation (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.
Established over 40 years ago with the acquisition of Hotel Cipriani in Venice, Belmond owns and operates a global collection of luxury hotels and travel adventures in some of the world’s most sought-after destinations. The company operates in 24 countries with its distinct portfolio of 46 hotel, rail and river cruise experiences, including the Belmond Mount Nelson Hotel in Cape Town and, in Botswana, Belmond Safaris includes the Belmond Eagle Island Lodge, the Belmond Khwai River Lodge and the Belmond Savute Elephant Lodge.
Jocelyn Betts, Belmond Corporate Communications Director (Global), told Tourism Update that the group’s existing operations were unaffected by the announcement, however at this early stage, Belmond was unable to provide further details beyond what had already been shared publicly.
Through the acquisition, LVMH will significantly increase its presence in the ultimate luxury hotel world.
Roland Hernandez, Chairman of the Board of Directors of Belmond Ltd, commented: “Following a strategic review that attracted broad and deep interest from a wide range of real estate and lodging companies, sovereign wealth institutions and other financial buyers around the world, the Board has 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.”
Belmond’s President and Chief Executive Officer, Roeland Vos, said that the announcement is the result of the strong execution of Belmond’s strategic vision that builds on its pioneering legacy. “We are confident that, as part of LVMH’s world-class family of brands, Belmond’s ability to deliver timeless, one-of-a-kind luxury experiences will reach new levels.”
Bernard Arnault, Chairman and Chief Executive Offer of LVMH, added: “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…This acquisition will significantly increase LVMH’s presence in the ultimate hospitality world.”