Accor buys South American hotel chain for $275 million

Source: Reuters

Accor has agreed to buy the South American hotel portfolio of Mexican company Grupo Posadas for $275 million as it accelerates expansion in fast-growing emerging markets at a time of muted growth in Europe.

The deal follows Accor's sale of troubled U.S. budget hotel chain Motel 6 for $1.9 billion in May and the closing of the acquisition of Australian hotel group Mirvac.

"The acquisition is justified from a strategic standpoint, strengthening Accor's leadership in Latin America ... and taking Accor away from its European focus," Oddo Securities analysts said in a note.

The purchase includes 15 hotels in Brazil, Argentina and Chile. It also includes 14 hotels under management contract, as well as two brands operated by Grupo Posadas in South America - Ceasar Park and Ceasar Business.

The deal should close by the end of 2012, Accor said.

Accor, the world's fourth-largest hotel group behind the InterContinental, Marriott, and Starwoodchains, reports second-quarter revenue after the market closes on July 17.

"We expect the company to provide a positive trading update for the second quarter," Barclays analysts said in a recent note. "We believe that trading is likely to decelerate later this year, however."

(Reporting by Dominique Vidalon and Nina Sovich; Editing by James Regan)