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China: Huazhu to buy German luxury hotel group Steigenberger

 |  November 4, 2019

China’s Huazhu is buying the Steigenberger hotels as it seeks to extend its global reach with the addition of one of Germany’s most well-known upmarket chains, reported Reuters. 

Huazhu, already the world’s fifth-largest hotel group by market capitalization, is paying €700 million (US$781 million) in cash for Steigenberger parent Deutsche Hospitality.

That values Deutsche Hospitality, whose brands include MAXX by Steigenberger, Jaz in the City, IntercityHotels, and Zleep at 17-18 times its 2019 expected earnings before interest, tax, depreciation, and amortization or at less than 10 times expected 2022 core earnings. 

Peers such as Marriott, Hilton, and Hyatt trade at 11-14 times their expected core earnings over the next twelve months, while China International Travel and smaller peer Huazhu both trade at more than 20 times.

Full Content: Reuters

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