August 10, 2018 / 8:56 AM / 4 months ago

HNA sells Radisson Holdings to Jin Jiang-led consortium

HONG KONG (Reuters) - Cash-strapped Chinese conglomerate HNA Group Co Ltd [HNAIRC.UL] has agreed to sell Radisson Holdings Inc. to a consortium led by hospitality group Jin Jiang International Holdings Co, according to a Radisson announcement late Thursday.

FILE PHOTO: An HNA Group logo is seen on the building of HNA Plaza in Beijing, China February 9, 2018. REUTERS/Jason Lee/File Photo

The sale comes as the aviation-to-financial services HNA group has been shedding assets such as real estate to slash the massive debt it accumulated from its acquisition spree in recent years.

As part of the deal, the consortium agreed to buy 51.15 percent of the outstanding shares of Nasdaq Stockholm-listed Radisson Hospitality AB at 35 Swedish crowns ($3.87) per share, or a total of about 3 billion Swedish crowns ($332 million). The offer price represents a 5 percent discount to the company’s stock price at Thursday’s close.

The Jin Jiang-led consortium would buy an additional 18.5 percent stake in Radisson Hospitality that HNA Sweden has pledged and transferred to a lender as security for a loan, said the companies.

After the share purchase, the consortium would also acquire 100 percent of Radisson Holdings Inc for an undisclosed amount.

HNA’s tourism unit in 2016 bought 100 percent of U.S-based Carlson Hotels Inc for an undisclosed sum, including its 51.3 percent stake in Rezidor Hotel AB, which was later renamed Radisson Hospitality AB as part of HNA’s rebranding effort earlier this year. HNA offered 34.86 Swedish crowns per share at the time.

A person with direct knowledge said HNA spent more than $2 billion in that transaction, which gave HNA hotel brands including Radisson, Park Plaza, Country Inns & Suites and 1,400 hotels in 115 countries. HNA declined to comment beyond the announcement. The person is not authorized to speak to the media and therefore cannot not be named.

Shares of Radisson Hospitality fell as much as 1.5 percent on Friday.

The Jin Jiang-led consortium would be obligated under Swedish rules to launch a mandatory public tender offer for the remaining outstanding shares in the listed company, once its current stake purchase is completed.

Shanghai-headquartered Jin Jiang is mainly engaged in hotel management and investment, tourist services and transport and logistics.

Reporting by Kane Wu; Editing by Sunil Nair

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