SINGAPORE -- Singapore-based hotel and resort operator Banyan Tree Holdings announced Thursday AccorHotels has bought a stake in it and was seeking to grow the luxury brand outside Asia.
AccorHotels will invest an initial 24 million Singapore dollars ($16.9 million) in Banyan Tree. The investment in the form of a convertible debenture will give AccorHotels a stake of about 5% in Banyan Tree, with an option to buy an additional 5% later on.
AccorHotels hopes to offer its customers a wider selection of luxury hotels through its investment in Banyan Tree. "Our plan is to expand the Banyan Tree brand globally but particularly outside of Asia -- in Europe, the Caribbean and the Middle East," said Gaurav Bhushan, global chief development officer of AccorHotels.
Both companies will develop hotels under the Banyan Tree umbrella. Banyan Tree also owns spas, golf courses and the Angsana resorts which are targeted at families. Earlier this year, AccorHotels, already Europe's largest such group, bought FRHI Holdings for $2.7 billion. That deal gives AccorHotels control over the Raffles, Swissotel and Fairmount brands of hotels.
This latest partnership will allow Banyan Tree to access a wider pool of customers through AccorHotels' global reservations and sales network as well as its loyalty program. Banyan Tree hotels and resorts in Asia have been hit by sluggish demand.
It reported a net loss of S$10.81 million for the quarter ended September, almost double the amount reported in the same period last year. Revenue for the quarter was down 23% year-on-year at S$62.6 million.
But Thursday's news cheered investors. Banyan Tree stock shot up by about 10% from the previous day to S$0.435, the highest in more than two months.
Banyan Tree has been keen to establish a presence elsewhere, including in Cuba, Turkey and Morocco, to grow its brand and offset lower occupancy rates in its primarily Asian base. Early next year, Banyan Tree will open a resort in Cuba's Jardines del Rey archipelago, known for its pristine beaches and diverse wildlife.