How 2021 Hotel M&A Is Shaping Up After the Hyatt-Apple Leisure Deal
Skift Take
Hyatt's $2.7 billion purchase this week of the Apple Leisure Corporation clearly underscores the returning confidence of investors in the hospitality sector. The recovery of hotels and return of profits by their owners spells one thing to investors: some return to certainty. In fact, the value of deals in hotels so far this year is three times greater than the value of those for all of 2020.
Of course, last year was the nadir for the industry because of the pandemic, and nobody really expected a return to the blockbuster deals of just a few years ago even in a full recovery, but the momentum is picking up on buyouts.
The Hyatt-Apple deal represents one of eight merger-and-acquisition deals worth more than $1 billion announced this year with the size and scope of the deals not what the industry expected. Indeed, the despite the size of Hyatt's acquisition, industry insiders believe that the era of massive mega-mergers are in the past as major hotel companies are focusing on conversions, deals in which hotel owners are taking on a brand conversion.
So how are hotel merger deals for 2021 shaping up? Apple's purchase of Hyatt — the fourth largest in terms of total transaction value, excluding deals involving special purchase acquisition companies — was one of 308 such deals worth $43.4 billion that have taken place this year. The largest deals announced in 2021 appear in the table below, based on Skift Research and S&P Capital IQ data.
Largest Hotel Merger and Acquisition Deals 2021
| Announced Date | Total Transaction Value ($USDmm) | Target | Buyer |
|---|---|---|---|
| Mar-21 | $6,340 | Extended Stay America, Inc. | Blackstone Inc. (NYSE:BX); Starwood Capital Operations, LLC |
| Feb-21 | $4,535 | FAST Acquisition Corp. (NYSE:FST) | Fertitta Entertainment, Inc. |
| Mar-21 | $3,393 | Diamond Resorts International, Inc. | Hilton Grand Vacations Inc. (NYSE:HGV) |
| Aug-21 | $2,769 | Apple Leisure Group | Hyatt Hotels Corporation (NYSE:H) |
| Mar-21 | $2,250 | Operating Assets of Las Vegas Business of Las Vegas Sands Corp. | Apollo Global Management, Inc. (NYSE:APO) |
| Apr-21 | $2,164 | Gores Metropoulos II, Inc. (NasdaqCM:GMII) | Sonder Holdings Inc. |
| Jun-21 | $1,306 | Abu Dhabi National Hotels Company PJSC (ADX:ADNH) | Abu Dhabi National Exhibitions Company PJSC |
| Jun-21 | $1,072 | Thayer Ventures Acquisition Corporation (NasdaqCM:TVAC) | Inspirato LLC |
| May-21 | $818 | Riu Hotels S.A. | Saranja S.L. |
| Jun-21 | $681 | Cheval Blanc Randheli/ Etihad International Hospitality | Alpha Dhabi Holding PJSC (ADX:ALPHADHABI) |
| May-21 | $650 | RRR Palms LLC | San Manuel Gaming and Hospitality Authority |
| May-21 | $622 | Four Seasons Resort Orlando at Walt Disney World® Resort | Host Hotels & Resorts, Inc. (NasdaqGS:HST) |
| Jul-21 | $523 | Selenta Hospitality Group, S.L. | Brookfield Asset Management Inc. (TSX:BAM.A) |
| Jan-21 | $485 | Welk Hospitality Group, Inc. | Marriott Vacations Worldwide Corporation (NYSE:VAC) |
| Mar-21 | $479 | Assets of EHT US1, Inc | Madison Phoenix LLC |
| Jun-21 | $432 | Margaritaville Hollywood Beach Resort Property | Pebblebrook Hotel Trust (NYSE:PEB) |
Source: CapitalIQ, Skift Research. Data as of August 16, 2021.
The pickup in M&A is a true sign that hotel brand owners are seeing opportunities to convert others to their flags. Whether the Delta variant puts a screeching halt to this confidence will become more clear deeper into the third quarter.
For More on Hotel Owners, Subscribe to Skift Research for this report on the 2021 Hotel Owners Landscape.
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