Chinese hotel operator Huazhu Group is eyeing to buy foreign hotels as the domestic travel has recovered, with Covid-19 cases being largely eradicated in the country.
The Nasdaq-listed operator has raised $783m through a second listing in Hong Kong. It began trading on Nasdaq in 2010.
China is currently the only major country estimated to grow in 2020, although at a slower pace than earlier estimated.
Huazhu stands at an advantage over its global peers, which are seeing revenue drop, reported Bloomberg. In the second quarter, the hotel group’s occupancy rate stood at 69%, while that of Hilton was at 22% and Marriott at 14%.
In a recent interview with Bloomberg, Huazhu group president Jin Hu said: “We won’t hesitate to take action if there are proper acquisition targets, as operators with global presences will face challenges in the next one or two years amid virus and geopolitical tensions. With capital raised from the IPO, we are able to seek partnerships at any level.”
Huazhu expects to open over 1,600 new hotels in 2020 and has a target of 10,000 hotels by 2023, up from the present 6,000 hotels.
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With local consumers being unable to travel abroad, billions of spending has gone back to domestic firms. Holidays to domestic destinations such as Hainan are sold out.
Huazhu may find it tough to make foreign acquisitions with the recent months seeing stiff opposition to bids of Chinese firms to buy foreign firms in countries such as the US, Australia, Canada over a wide range of issues such as trade, human rights, etc.