“Nothing is off the table” when it comes to the “strategic alternatives” that the Belmond board of directors is currently reviewing for the luxury hospitality company.

That was the primary message delivered by Belmond’s chairman of the board of directors, Roland Hernandez, during the company’s second quarter earnings conference call on Thursday, a day after news broke of Belmond’s intent to explore a possible sale of some — or all — of the company.

The assets include 46 hotel, rail, and river cruise experiences spread out around the world, among them the Belmond Hotel Cipriani in Venice, the Belmond Hotel Splendido in Portofino, Belmond Le Manoir aux Quat’Saisons in Oxford and the 21 Club restaurant in New York.

While Hernandez and Belmond CEO Roeland Vos did their best to inform analysts and shareholders about what might happen as the board proceeds with its review, questions no doubt arose, such as why is the company pursuing a sale now? Who might eventually buy Belmond? And for how much? And what are some potential risks?

Whatever the answers to those questions may be, however, it’s clear that Wall Street is taking the news very well with multiple congratulations from analysts during Thursday’s conference call.

Shares of Belmond were trading at $15.35 a share Thursday afternoon, a 38 percent increase from the stock’s previous closing price of $11.12, and just shy of the company’s 52-week high share price of $16.20.

The ‘Problem’ with Belmond

Analysts and shareholders are likely pleased with this news because Belmond has struggled financially in the past few years, and especially since it rebranded itself to Belmond from Orient-Express Hotels in 2014.

“Belmond has always been a bit of a problem child,” Dillip Rajakarier, Minor Hotels CEO and Minor International chief operating officer told Skift when asked for his thoughts on Belmond’s possible sale. “I think the board has been settling for some time in terms of creating shareholder value.”

He continued, “They have had issues in terms of performance over the last few years. Belmond produced a five-year plan and they are not really delivering on those numbers, and now they have decided to look at different strategic options … it’s something I think they should have done a long time ago.”

Rajakarier is not alone in his assessment, either. Earlier this year, former Belmond chief operating officer Filip Boyen told Skift: “Belmond needs to get off the table.”

Belmond’s most recent second quarter earnings seemed to bolster Boyen and Rajakarier’s assessments, but also hinted that the company is getting back on track and attempting to make itself more attractive to potential buyers.

The company reported a net loss of $1.5 million in the second quarter, which was lower than the $4.9 million loss that it saw in the second quarter of 2017, and it also recorded impairment charges of $7.1 million across its two businesses in Myanmar, which suffered from reduced visitor arrivals to the country.

“While constant currency RevPAR [revenue per available room] came in at the low end of the range we had targeted, adjusted EBITDA [earnings before interest, taxes, depreciation, and amortization] grew 6 percent versus the prior-year period, or 11 percent on a reported basis,” Vos said.

As the company proceeds on its five-year strategic plan, which was announced in 2016, it’s looking closely at EBITDA as an accurate measure of the company’s health. The plan calls for doubling the number of properties in Belmond’s portfolio and doubling its total adjusted annual EBITDA from $120 million in 2015 to approximately $240 million in 2020. Belmond also reaffirmed its annual EBITDA guidance for this year, expecting adjusted full-year EBITDA to be between $140 million to $150 million.

But an additional challenge for the company doesn’t just relate to EBITDA or the number of properties it has, but to its brand perception and awareness.

The change from Orient-Express Hotels to Belmond was a difficult one to navigate, and it’s being made all the more complicated now that French hospitality giant AccorHotels has made an investment in the Orient-Express name with the intent to reinvent that very brand.

In that same conversation with Boyen earlier this year, Boyen said he told an AccorHotels official, “Instead of creating your own Orient-Express brand, why don’t you just buy Belmond and rebrand it back to Orient-Express? That will solve your problem in one full sweep.”

Last year, Belmond embarked on a major marketing campaign, called “The Art of Belmond” to solidify its name and brand positioning and introduce itself as a brand of choice for luxury train, cruise and hotel travel.

Vos told investors Thursday that the benefits of that campaign and Belmond’s branding efforts overall are being demonstrated in increased direct bookings for Belmond. “We saw impressive rise in the commission-free bookings by our website for the quarter, which is 10 percent building on the already 20 percent rise that we saw in Q1,” he remarked.

But more often than not, Belmond is still known more for its association with Orient-Express, even within the travel industry.

“As much as they try to create the same connotations under Belmond as were inherent in the Orient-Express brand name, it never really captured the public imagination in the same way, so I think many people in the travel industry have always reverted to saying, ‘Belmond, you know, the former Orient-Express collection of hotels,'” said Melissa Biggs Bradley, founder and CEO of luxury travel planning company Indagare Travel. “Just that name Orient-Express conjures up history and glamour and the kind of luxury travel in the best sense of the old-school way. It’s a shorthand that still resonated with their target client in a way that Belmond never could.”

How Much Can Belmond Sell For?

Whatever challenges Belmond may be facing in terms of its earnings and brand awareness or strength, one thing nearly everyone in the industry can agree on is the tremendous value of Belmond’s real estate assets, which include some of the most iconic properties in the world. There’s certainly a scarcity value attached to these assets, and Belmond’s rising share prices seem to reflect that.

And unlike many of its hotel peers, such as Marriott, Hilton, and AccorHotels, Belmond still owns a vast majority of its hotels.

Although the company’s current market capitalization is approximately $1.34 billion, it’s believed that Belmond’s true value could be worth even more when you factor in its owned hotels.

“We put out a value of $2 billion versus Belmond’s current market cap of $1.34 billion,” David Katz, managing director of Jeffries told Skift. “It has really jewel, one-of-a-kind real estate assets that we believe any private equity or private real estate owner would want to own.”

Katz added, “This has been going on for 15 years. The underlying real estate is far greater than its current trading value.”

The uniqueness of each of the 46 properties in Belmond’s collection is not lost on luxury travel planners, Biggs Bradley included.

“That variety of properties that are anything but cookie cutter is what makes [Belmond] special,” she said. “If someone can figure out how to maintain that with a collection, that’s great. The tragedy would be if, in buying the collection, they dilute the properties’ individual personalities and turn them into victims of sameness.”

The Belmond Hotel Splendido in Portofino, Italy. Source: Belmond

So Why Sell Now?

Why has it taken this long for Belmond to finally consider a possible sale?

Hernandez said “there was no single catalyst” that spurred Belmond and its board to consider a sale of the company, but that they were encouraged by the “strong operating momentum” the company has achieved in recent quarters, including a healthy development pipeline that consists of five letters of intent and discussions about “several management contracts.”

“This puts us in a position of strength as we move forward,” Hernandez noted. That strength, coupled with a healthy environment for both hospitality and luxury hospitality mergers and acquisitions, in particular, have convinced the board to pursue a review.

Who Might Want to Buy Belmond?

So, who might buy Belmond, and why? The obvious suspects include, of course, private equity firms, as Katz noted, as well as other major hotel companies for whom consolidation is increasingly becoming the business strategy of choice.

“Hotels,” Katz said, “could do better on a large scale where [Belmond] might benefit from the value of a loyalty program and website booking and far better distribution, as well as cost savings, such as better procurement.”

“These days, if funding is quite cheap, I’m sure a lot of the bigger players will be looking at Belmond,” Minor Hotels’ Rajakarier noted. When asked if he had any insight into which players would be interested in pursuing Belmond, Rajakarier said, “I don’t know. I’m sure there are people who would buy Belmond for its real estate.”

And when asked if Minor would be interested in pursuing Belmond, Rajakarier avoided answering the question, only to say, “You know, we look at transactions all the time. The only way we would be interested is if we feel that the transaction is accretive to our shareholders. Then we’d look at it, otherwise we won’t.”

A more likely candidate for buying Belmond is, as Boyen suggested earlier this year, AccorHotels, who has gained a reputation in the industry for its acquisitive nature. And it already has a bit of an advantage too, in that it already invested in Belmond’s former brand name, Orient-Express, as well as having a sizable amount of capital to work with, and having expressed its desire to boost its luxury inventory.

And then, of course, there is Hyatt Hotels Corporation, whose hopes of acquiring NH Hotel Group and, previously, Starwood Hotels and Resorts, were dashed. In its pursuit of scale, Belmond’s luxury properties would be an attractive addition for Hyatt, although the asset recycler would likely look to sell those real estate assets if it did try to buy Belmond.

During Hyatt’s second quarter earnings conference call with investors, CEO Mark Hoplamazian said “we are focused on acquisitions and investments that, first and foremost, help expand our presence in distribution in places where we are underrepresented and secondly … investments that are accretive to earnings but also, asset-light in nature.”

Indagare Travel’s Biggs Bradley, for one, is hoping Rosewood Hotels considers placing a bid for Belmond. She said that Rosewood’s track record for “maintaining high-end properties and their distinct personalities and characteristics” and making sure their hotels are anything but “cookie-cutter” would be a relief to the luxury travel community.

“I think that at the really high end, people are really allergic to this sense of sameness that happens at so many of the big, corporate five-star brands; they want that personality and they don’t just want to feel like a number on a revenue line,” she said. “That’s why Belmond has intense loyalty amongst its guests. They feel like the Cipriani — that so many of those properties — are truly distinct, and that’s been the magic of Belmond.”

She also noted the “passionate response” that news of Belmond’s possible sale brought not only to her office but to her clients as well.

“For a lot of people, trading assets in the hotel space — they’re used to it,” Biggs Bradley explained. “Whether something is flagged under one global brand or another, it doesn’t elicit the kind of reaction that this group does. These are the kinds of places people mark milestones in their lives at … that dig deep into people’s emotional experiences. That’s why it was very different from how news would be for other brands, and that’s why we care about who buys it so much.”

Skift Editor’s Note: An earlier version of this story mistakenly listed Filip Boyen as the former CEO of Belmond. He was the former COO.

Photo Credit: The Belmong Hotel Cipriani in Venice is just one of many iconic properties that are part of Belmond, which has announced it may seek a sale of some or all of its company. Belmond