Saudi Arabia's Wealth Fund Takes 49% of Rocco Forte in Luxury Hotel Play
Skift Take
Key Points
- Saudi Arabia's Public Investment Fund has bought a 49% stake in Rocco Forte Hotels.
- The deal values the 14-hotel portfolio at $1.8 billion and includes plans to double its size in five years.
- The investment aligns with Saudi Arabia's strategy to diversify its economy and maintain the Forte family's majority ownership.
Summary
Saudi Arabia's Public Investment Fund has acquired a 49% stake in Rocco Forte Hotels, valuing the 14-hotel portfolio at $1.8 billion. The investment includes plans to double the portfolio size over the next five years, reflecting Saudi Arabia's strategy to diversify its economy away from fossil fuels. The deal maintains the Forte family's majority ownership, with Sir Rocco Forte continuing as executive chairman.
Saudi Arabia's Public Investment Fund has acquired a significant minority stake in Rocco Forte Hotels, the luxury hotel operator said Monday.
Saudi Arabia bought the full equity stake of the Italian entity CDPE Investimenti. The Forte family retains its majority ownership.
The proposed deal would value the 14-hotel portfolio at $1.8 billion (£1.4 billion, including debt).
The group generated EBITDA of approximately $81 million in its financial year through April, according to its UK filings, on revenues of about $370 million.
Further Capital Injection
This move builds on Rocco Forte's growth trajectory. Saudi Arabia's fund pledges to also invest "tens of millions" of dollars to roughly double the size of the hotel portfolio over the next five years.
The group has already announced plans to open three more hotels in the next two years.
The investment reflects the fund's focus on international hospitality and tourism industries as a strategic diversification away from fossil fuels.
Rocco Forte Hotels was established in 1996 by Sir Rocco Forte and Olga Polizzi. Forte will stay as executive chairman, and Olga Polizzi will stay as deputy chairman. The Financial Times first reported the news.
"[Saudi Arabia's Public Investment Fund] is an excellent partner for us going forward," Sir Rocco Forte said in a statement. "We have established an extremely good relationship during the course of our negotiations. They share the same vision for the brand and the future strategy of the group with the same ambition to take a long-term view."
Accommodations Sector Stock Index Performance Year-to-Date
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Photo Caption: Exterior of the Hotel de la Ville, in Rome, Italy, which is owned by luxury hotel group Rocco Forte. Source: Rocco Forte Hotels
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