Hyatt has reached an agreement with the affiliates of KKR and KSL Capital Partners to purchase luxury resort-management services provider Apple Leisure Group (ALG) for $2.7bn in cash.
The transaction will expand Hyatt’s presence in luxury and resort travel, enhance leisure travel offerings, accelerate its asset-light strategy, increase choice and experiences for guests and provide significant opportunities for its existing resorts.
ALG owns a hotel portfolio comprising of more than 33,000 rooms in ten countries.
The company through its brand management platform, AMResorts, delivers management services to luxury resorts in the Americas under the AMR Collection master brand.
AMR Collection was introduced earlier this month and brings together six resort brands, namely Secrets, Dreams, Breathless and Sunscape Resorts & Spas, Zoëtry Wellness & Spa Resorts and Alua Hotels & Resorts.
In addition to these properties, Hyatt takes over ALG’s membership offering, Unlimited Vacation Club, travel distribution business ALG Vacations and other assets.
Hyatt president and chief executive officer Mark Hoplamazian said: “With the asset-light acquisition of Apple Leisure Group, we are thrilled to bring a highly desirable independent resort management platform into the Hyatt family.
“The addition of ALG’s properties will immediately double Hyatt’s global resorts footprint. ALG’s portfolio of luxury brands, leadership in the all-inclusive segment and large pipeline of new resorts will extend our reach in existing and new markets, including in Europe, and further accelerate our industry-leading net rooms growth.
“Importantly, the combination of this value-creating acquisition and the $2bn increase in our asset sale commitment will transform our earnings profile, and we expect Hyatt to reach 80% fee-based earnings by the end of 2024.”
The deal is subject to customary closing condition and expected to complete in the fourth quarter of 2021.
Upon completion of the deal, the new owner will retain the company’s current management team including CEO Alejandro Reynal.
He will join as a member of Hyatt’s executive leadership team and report to Hyatt CEO Mark Hoplamazian.
Earlier this month, Hyatt opened Thompson Savannah in Georgia, the US. It features 193 guestrooms including 21 suites.