AccorHotels to consolidate leadership in Brazil with the integration of 26 BHG hotels

AccorHotels announces it has signed an agreement with Brazil Hospitality Group (BHG) and its shareholders, funds managed by GP Investments and GTIS Partners, in order to take over the management of 26 hotels (c. 4,400 rooms) currently owned or managed by BHG, the third-largest hotel company in Brazil.

The portfolio includes economy, midscale and upper upscale hotels in Brazil's major markets, especially in Rio de Janeiro and Sao Paulo, complementing well AccorHotels' existing network in Brazil, and consolidating the Group's leadership across all segments. The hotels will undergo major renovation and repositioning works and shall progressively be reflagged until the end of 2019 under AccorHotels brands, including ibis, ibis Styles, ibis Budget, Mercure, Novotel, Mama Shelter, MGallery and Pullman, under long-term management agreements.

The management portfolio will be acquired by AccorHotels for a consideration of R$ 200m, or c. €60m at current exchange rate. The transaction is expected to close in Q4 2017 and is subject to the approval of the Brazilian antitrust authority. It will be accretive to AccorHotels results as soon as 2018, notably thanks to significant synergies with the Group's existing operating platform in the country.

Sebastien Bazin, Chairman & CEO of AccorHotels said: "Today's Brazil is a land of major opportunities. This transaction is a new milestone in the history of AccorHotels in this country, where we have been a firm leader for decades. It will bring new landmark hotels as well as an increased brand awareness across all segments. It also anchors a strong and long-term relationship with BHG, one of the largest owners of hotel real estate in Brazil, which will bring incremental growth opportunities going forward."

Alexandre Solleiro, CEO of BHG said: "We are thrilled with the opportunities that this transaction creates for our company, our business partners and our teams. Because 100% of the capital generated from this transaction will be reinvested in our owned hotels, we will be able to accelerate the repositioning and performance of BHG as a leading owner of hotels in Brazil. At the same time, we will also be able to better focus our resources and management teams in the development of our business of managing third party hotels through our owned and licensed brands."

ABOUT BHG

BHG, third largest hotel chain in Brazil, has as its mission to host and make people feel good. The company owns and manages a portfolio of more than 50 hotels, of which 17 are prime locations in the economic, mid-scale, up-scale and luxury segments. The group, recognized for its multi-brand management / operator expertise, represents Royal Tulip, Golden Tulip and Tulip Inn brands in Brazil. BHG also has hotels with their own flags, such as Soft Inn, and hotels without flags, such as Marina Palace, in Leblon - Rio de Janeiro and The Capital, in São Paulo. The company focuses on the modernization of its hospitality and products, the implementation of most advanced methods and technology of management and distribution, as well as the evolution of the service provided to all those who travel for leisure or business. Headquartered in Brazil, BHG is committed to the development of the sector in the country and is looking for business opportunities.

ABOUT GP

GP Investments is a listed company since 2006 with USD 1 Billion in proprietary capital. Since its inception in 1992, the company has raised approximately US$5.0 billion from international investors and has acquired 54 companies in 16 sectors, including Telecom, Logistics, Retail, Real Estate, Consumer Goods, Education and Insurance Services. GP Investments has followed a consistent and disciplined Investment strategy targeting established companies that have the potential, through hands on approach and active management, to grow and to be more efficient and profitable, becoming the leaders in their respective industries. GP Investments currently has offices in Bermuda, US, UK and Brazil. For further information, please visit www.gpinvestments.com.

ABOUT GTIS PARTNERS

GTIS Partners is a global real estate investment firm headquartered in New York with offices in Los Angeles, San Francisco, Houston, Atlanta, São Paulo, Paris, and Munich. GTIS Partners has 85 employees and had approximately $3.8 billion of assets under management as of September 2016. To date, the firm has committed capital to residential, retail, industrial, office, hotel and mixeduse projects in the U.S. and Brazil. In the U.S., GTIS has committed over $1.5 billion of equity and debt to 91 projects in 22 states. In Brazil, GTIS has invested in 91 assets comprised of approximately 13,000 planned or completed residential units, over 530,000 square meters of planned or completed office and industrial space, and over 9,800 hotel rooms owned, managed, or under development. By combining hands-on real estate expertise with a disciplined investment approach, GTIS Partners helps create value for its investors and partners. The firm pursues opportunistic real estate investments through direct equity investment and non-traditional lending activities and the firm relies on macro-research as well as the hands-on industry knowledge of its experienced investment and asset management teams. For further information, please visit www.gtispartners.com.