23 January 2014
Marriott International, the largest publicly traded hotel chain in the United States, has signed agreements to acquire the three brands and management company of South Africa’s Protea Hospitality Holdings, in a transaction that will make Marriott Africa’s biggest hotel company by number of rooms in operation or under construction.
Protea has 116 hotels with 10 148 rooms in seven African countries including South Africa. Once the deal is finalised, Marriott will become the largest hotel company in the Middle East and Africa region.
Announcing the signing of definitive agreements for the purchase on Wednesday, Marriott said the deal was worth R2.02-billion (approximately US$186-million).
The company said in November, when it signed a letter of intent to make the acquisition, that the transaction would nearly double Marriott’s distribution in Africa to more than 23 000 rooms, “and would also provide Marriott with a proven operational platform and leadership team to accelerate Marriott’s expansion plans and solidify its leadership position in the dynamic and growing African hotel market”.
Marriott International CEO Arne Sorenson said the African continent “has significant untapped potential for travel and tourism, both as a destination and source of new global travellers.
“The continent’s GDP is anticipated to grow at over five percent annually over the next several years, which we expect will raise more people into the emerging middle class,” Sorenson said.
“With the Protea Hotels acquisition, our expanded footprint should allow us to become the first choice of Africa’s rapidly growing population of young, sophisticated travelers, and drive loyalty to our Marriott Rewards programme both within Africa and globally.”
Protea Hospitality Group CEO Arthur Gillis said Protea Hotels had “grown organically to become the largest and leading hotel group in sub-Saharan Africa … In Marriott we have found a perfect fit across culture, values and commitment to industry leadership which will ensure that we remain at the forefront of African hospitality”.