Skift Take

Saudi's main investment fund is a wolf in cashmere that knows the value of luxury assets. This deal underscores the enduring resilience and allure of European luxury travel.

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

What am I looking at? The performance of hotels and short-term rental sector stocks within the ST200. The index includes companies publicly traded across global markets, including international and regional hotel brands, hotel REITs, hotel management companies, alternative accommodations, and timeshares.

The Skift Travel 200 (ST200) combines the financial performance of nearly 200 travel companies worth more than a trillion dollars into a single number. See more hotels and short-term rental financial sector performance.

Read the full methodology behind the Skift Travel 200.

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Tags: future of lodging, luxury, luxury hotels, rocco forte, saudi arabia

Photo credit: 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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