ACCOR, Europe’s largest hotel group, said yesterday it would divide its hotel business in two in a bid to improve the group’s performance and boost shareholder returns.
The strategy includes a new organisation built by geography and an executive committee of 10 members, including five regional heads of operations, Accor said.
Three months after becoming chief executive of Accor, former private equity boss Sebastien Bazin said he was splitting Accor into a fee-oriented hotel operator and franchisor, HotelServices, and a hotel owner and investor, HotelInvest.
The new strategy will see the end of expansion through leases, as well as no further disposals of owned hotels unless they are underperforming assets.
“I want Accor to become the world’s best-performing and best-value hotel group,” Bazin told journalists.
Bazin did not provide any targets under his plan but said those set under a three-year revamp initiated a year ago by predecessor Denis Hennequin were no longer valid.
“We are banking on returns well above the previous plan,” he said.
Bazin confirmed Accor’s target to achieve operating profit of €510m to €530m in 2013, however, compared with €526m last year.
Shares in the Paris-listed firm fell 7.5 per cent to €31.05.
City A.M. Reporter