|Accor restructures and splits company, creating disappointed investors.|
Friday, 13th December 2013
Source : Martin Kelly
Accor's new Chairman and CEO, Sébastien Bazin, has split the huge French accommodation company into two divisions – HotelServices and HotelInvest. 'With this new strategy, our aim is to unlock Accor’s full potential through its two core activities and maximize value creation for shareholders,' he said.
Unfortunately shareholders were underwhelmed and Accor shares fell 7.5% after Mr Bazin's announcement, his first after taking control of the company in August. According to the Financial Times, they were looking for Accor to sell the hotels it owns and return cash to shareholders.
In summary Mr Bazin defined the new divisions as:
"All 1,400 hotels of HotelInvest will be operated by HotelServices through management contracts," Accor said in a press release.
- HotelServices: a hotel operator and brand franchisor that will be fee-oriented and P&L driven.
- HotelInvest: a hotel owner and investor that will be yield-oriented and balance sheet driven.
"Each business unit will have its own reporting, with separate P&L, Cash-Flow statement and balance sheet. They will report to single Executive Committee. The Group will retain key central functions including Finance, HR, Legal and Communication.
"HotelServices is pure fee-oriented hotel operator & brand franchisor, that boasts strong brands, a winning path in distribution, and robust development. It will comprise the Management & Franchise, Sales & Marketing, distribution and IT departments.