France’s LVMH buys Le Manoir owner Belmond for $3.2 billion

by | Dec 25, 2018 | News

Aquisition of the most prestigious sets of hotel, restaurant, train and river cruise properties.

Renowned French luxury goods company LVMH has agreed to buy Le Manoir, which is owned by Belmond.

The transaction, which will total £2.5 billion ($3.2 billion), is slated to be completed in the first half of 2019 pending Belmond shareholder approval.

It will see the French firm acquiring one of the world’s most prestigious sets of hotel, restaurant, train and river cruise properties. LVMH would also cement its wine distribution network with the purchase, said industry experts.

The transaction breaks down like this: LVMH will pay $25 (£19.84) per share for the 46-strong portfolio. The price of this sale values Belmond at $2.6b (£2.07b), which, adding debt, takes the acquisition price up to roughly $3.2 billion.

Belmond, based in London, will soon have two hotels in the United Kingdom: the first being Belmond Le Manoir aux Quat’Saisons in Great Milton, Oxfordshire, and the second Belmond Cadogan, which will open its doors in London’s Knightsbridge area in February 2019.

Belmond has luxury properties across the globe, with a list of iconic properties that includes the Hotel Cipriani in Venice, the Hotel Splendido in Portofino, and the famous Copacabana Palace in Rio de Janeiro.

In addition to hotels, the Belmond collection also includes trains such as the Venice Simplon-Orient-Express and the Belmond Royal Scotsman.

News of this sale first emerged in August, when the company tapped Goldman Sachs and JP Morgan to serve as financial advisors carrying out a review of its business.

There is a clear objective on LVMH’s behalf for this deal, with that being a vastly increased presence in the luxury hospitality sector.

LVMH is no stranger to high-end offerings, however, with a list of existing holdings such as Dom Pérignon, Krug, Louis Vuitton, Christian Dior Couture and TAG Heuer watches amongst a wider portfolio of brands.

It has an existing hotel presence with the Bulgari and Cheval Blanc brands.

Experts say LVMH fought off strong competition from a large field of other bidders, which likely included government interests from the Middle East and Asia, in addition to global hotel brands.

Roland Hernandez, chairman of the board of directors of Belmond, had this to say about the purchase: “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.”

Bernard Arnault, Chairman and Chief Executive Officer of LVMH, added: “Belmond delivers unique experiences to discerning travelers 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 Bulgari hotels activities. This acquisition will significantly increase LVMH’s presence in the ultimate hospitality world.”

Let’s take a look at a few other projects currently underway by Belmond:

Belmond Cadogan Hotel

Belmond Castello di Casole

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