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BTS on the hunt for more hotel chains in Europe

Posted by pakin On December - 13 - 2017

SET-listed BTS Group Holdings Plc (BTS) is mulling the acquisition of another hotel chain in Europe, worth up to 10 billion baht, to reinforce its global presence, says chairman Keeree Kanjanapas.

The company aims for average annual net profit growth of 25% over the next five years.

“There’s the possibility we might acquire more hotel chains in Europe to expand our hotel business and build a strong global presence,” he said.

BTS Group is in talks with two hotel chains in Europe, said Mr Keeree. The first chain operates wellness resorts with locations across central Europe. The second chain runs hotels in inner city locations with no more than 200 rooms each, with properties in France, Germany, the Czech Republic and Spain.

The deal is expected to be worth up to 10 billion baht, he said, but would not reveal the targeted hotel chains.

BTS Group’s latest move underscores fresh efforts to penetrate deeper into the hotel market abroad.

The diversified holding company, spanning from elevated trains to property development and food businesses, earlier this year successfully dipped its toes in the overseas hotel market by taking over the entire stake in Vienna International Hotel Management AG (Vienna House) through its 35.6%-owned affiliate, U City Plc. That deal, worth 12.3 billion baht, is further part of plans to ramp up recurring revenue.

Vienna House has 16 upscale leisure and business hotels and eight hotels operating in several European countries, including Germany, the Czech Republic, Poland, Romania, Austria, Belarus, France, Russia and Slovakia.

Mr Keeree said that at its next shareholder meeting, set to be held on Jan 4, BTS Group will ask for permission to restructure by transferring all its property businesses to be held under U City.

These businesses include a 50% joint venture, Absolute Hotel Services, which operates hotels under the U Hotels & Resorts, Eastin Hotels, Eastin Residences and Eastin Easy brands; and more than 20 condominium projects developed via joint ventures between BTS Group and another SET-listed property developer, Sansiri Plc.

He said that the number of undeveloped land plots currently owned by BTS Group’s subsidiary, Unicorn Enterprise Co Ltd, will also be transferred to U City.

“If the restructuring plan is approved, U City will no longer be a small real estate company, with its business spanning the globe. We expect it will soon be able to start paying dividends to shareholders,” said Mr Keeree.

Property is one of the four main businesses of BTS Group, with others including infrastructure through Bangkok Mass Transit System Public Co Ltd and its media business through VGI Global Media Plc.

He said BTS Group is also hoping to invest in the 16.4-kilometre western Orange Line, running from Thailand Cultural Centre to Taling Chan, worth 109 billion baht, on top of several double-track railway projects.

BTS shares closed yesterday on the Stock Exchange of Thailand at 8.25 baht, down five satang, in trade worth 138 million baht.

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