NH Hoteles & Esperia formalize intergration. Wednesday, 18th November 2009 Source : NH Hoteles

NH Hoteles and Hesperia have closed the agreement for the integration of their respective hotel management businesses.

Through this deal, NH Hoteles will manage 51 hotels that are currently owned or operated by Hesperia and the multinational hotel chain will increase its total number of operating hotels to 400 and its number of rooms to over 60,000.

Through this agreement, NH Hoteles acquires the management company of Grupo Hesperia. The purchase price is obtained through the annualized operating result for the management company in the second half of 2009, multiplied by a coefficient of 3,75.

With this deal, NH Hoteles assumes the management of all Hesperia hotels and not the purchase of their owned or leased hotels. In addition it reinforces the national and international presence of NH Hoteles without recurring to either capital or debt increases.

At the same time, Hesperia joins the Board of NH Hoteles. Javier Illa Ruiz, Hesperia’s CEO, enters the Board of NH Hoteles, substituting Manuel Herrando y Prat de la Riba who will continue working for NH in his current position as President of Sotogrande, the Group’s Real Estate division.

An Integration Committee has been created in order to maximize the synergies through the unified management of all hotels. This committee will be in charge of designing an efficiency and optimization plan for both companies.

This plan that should be ready for the first quarter of 2010, will define the actions concerning issues like sales and purchase management, operational efficiency of the two brands, technological platform among others. The plan’s objective is to generate significant synergies both at income and expenditure level, giving NH Hoteles greater competitiveness.

One the integration has been formalized, NH Hoteles has agreed to convene an Extraordinary Meeting of Shareholders to be held on 3rd December to propose both to extend the limitation of voting rights of shareholders from 10% to 20% and to reduce from 75% to 51% the quorum to modify or remove this limitation.