Huazhu Group to Acquire Deutsche Hospitality

SHANGHAI—Huazhu Group has reached an agreement to acquire all shares of Deutsche Hospitality through its wholly owned subsidiary China Lodging Holding Singapore.

Deutsche Hospitality is based in Frankfurt, Germany, and its portfolio includes five hotel brands: Steigenberger Hotels & Resorts, Maxx by Steigenberger, Jaz in the City, IntercityHotel and Zleep Hotels.

“Huazhu has enormous respect and admiration, particularly for the prestigious Steigenberger brand,” said Qi Ji, founder/executive chairman, Huazhu Group. “The legendary brand has a tradition for almost 90 years of providing a perfect balance of tradition and modernity to guests from all over the world. The legacy created by a highly respected German family and preserved and enhanced by the current owner and the exceptional management team is at the heart of the appeal of Deutsche Hospitality. Huazhu is committed to fully respecting and embracing the heritage of the company, and working closely with the company’s associates, owners and business partners in helping to write the next chapter.”

Deutsche Hospitality, which operates 118 hotels with 36 hotels under development in 19 countries on three continents, has also charted an ambitious growth strategy, according to the company. In 2019, the hotel group announced a worldwide expansion plan to reach 250 hotels by 2024. The acquisition by Huazhu will enhance Deutsche Hospitality’s ability to achieve this target by strengthening its competitive position in Europe, the Middle East and the African market. The shareholding of the Joint Venture SME Ltd. (Steigenberger Middle East) shall remain unchanged and will continue to operate and expand the Deutsche Hospitality brands with its current partner.

“This acquisition is an important milestone in our global growth strategy,” he said. “Deutsche Hospitality is a perfect strategic fit and we expect competitive advantages for both companies. The brands of Deutsche Hospitality will enhance the offering of Huazhu and its operating capabilities in the high-end European hotel market.”

In a statement, the executive board of Deutsche Hospitality commented, “Huazhu is one of the fastest-growing hotel companies in the world. We share the same values as Huazhu. We are both truly passionate about offering a high-quality experience to our customers, hence we are constantly aiming for improving our offering and services and innovating our operations. Both Huazhu and Deutsche Hospitality have strong and recognized brands, which we will maintain, while further accelerating their growth. We are very excited to become part of Huazhu Group.”

Huazhu has more than 5,000 hotels in more than 400 cities. Its loyalty program includes more than 139 million members. Huazhu operates 18 brands across market segments covering economy to upscale. Huazhu is also the ninth largest hotel company in the world by room count and the fifth largest by market capitalization. The acquisition of Deutsche Hospitality accelerates Huazhu’s expansion strategy, driving revenue growth in the upscale and luxury segments in Asia, including China, while expanding Huazhu’s international footprint, the company reports.

“We are extremely impressed by the passionate and professional management team, the service levels and the excellent relationship with all relevant partners and stakeholders,” said Jenny Zhang, CEO, Huazhu. “We look forward to working with Deutsche Hospitality to expand the high-quality offering and further enhance the experience of guests staying in these hotels. Deutsche Hospitality and its brands will maintain their distinctive personality and individuality while benefiting from Huazhu’s leading technology, advanced innovation abilities, strong partnerships, loyalty program, effective sales and marketing support, solid global distribution network and strong presence in the fast-growing Chinese market. I envision the merger of Deutsche Hospitality and Huazhu will create the foundation of a global hotel group that seamlessly combines European hospitality, German quality and Asian speed.”