MADRID (Reuters) - Spain’s NH Hotel Group (NHH.MC) said on Friday it had received a letter of interest from U.S. global hospitality company Hyatt Hotels Corp (H.N), firing the gun on a takeover battle with Thailand-based Minor International (MINT.BK).
Hyatt said it believed it would be in a position to launch a cash offer to acquire 100 percent of the company at a superior value to Minor’s June offer, which valued the Spanish hotel group at up to 2.5 billion euros ($2.9 billion), the letter said.
“We believe that the recently announced tender offer process for NH shares understates the intrinsic and economic value of the company,” said Mark Hoplamazian, Hyatt President and Chief Executive Officer, in the signed letter released to the Spanish stock exchange regulator.
Shares in NH jumped 3.7 percent at start of trade on Friday to 6.43 euros, slightly over Minor’s offer price.
Minor is currently NH’s biggest shareholder with a 29.8 percent stake, and has agreements in place to buy Chinese conglomerate HNA’s 8.4 percent holding and Oceanwood Capital Management’s 5.7 percent stake.
HNA, one of NH’s largest shareholders, is restructuring operations and selling assets to raise cash, partly to repay debt.
NH, with over 370 hotels in 30 countries, in January turned down a takeover offer from Spanish peer Barcelo which valued the company at 2.48 billion euros.
Hyatt requested access to NH’s books in order to make a firm decision and said it would require final approval from its board of directors after viewing this information to proceed with any offer.
Hyatt intends to make a formal announcement about whether to proceed during August or early September, it said in the letter.
Minor had agreed to pay HNA 622 million euros for a 26.5 percent stake in the hotel group, taking its stake to around 38 percent after the conversion of some bonds to shares. It would then offer 6.4 euros for each remaining share, it said.
NH Hotels said the offer, approved by Spanish and Portuguese competition watchdogs, undervalued the company.
Spain, by far NH’s biggest market with around a third of its hotels, became the second most visited country in the world after France in 2017, overtaking the United States.
($1 = 0.8586 euros)
Reporting By Sonya Dowsett; Editing by Julien Toyer and Jan Harvey