Hyatt to buy Apple Leisure Group for $2.7bn; Expands global resort footprint

By Amirtha P S, Desk Reporter
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Hyatt
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American multinational hospitality company, Hyatt Hotels Corp has entered into a deal to acquire a leading luxury resorts company, Apple Leisure Group from its private-equity owner KKR & Co and travel-and-leisure specialist KSL Capital Partners for $2.7 billion in cash.

In 2017, KKR and KSL bought the Pennsylvania-based resort operator from Bain Capital for an undisclosed price. The acquisition of Apple Leisure Group’s asset-light business will increase the percentage of revenues and earnings Hyatt will generate from fees, the American hospitality firm said in a statement.

Hyatt said it anticipates completing its current commitment to sell $1.5 billion of hotel real estate in 2021 and is further committing to an additional $2 billion in proceeds from the sale of hotel real estate by the end of 2024.

Mark Hoplamazian
Mark Hoplamazian
President & CEO
Hyatt

“With the asset-light acquisition of Apple Leisure Group, we are thrilled to bring a highly desirable independent resort management platform into the Hyatt family. The addition of Apple Leisure Group’s properties will immediately double Hyatt’s global resorts footprint. Apple Leisure Group’s portfolio of luxury brands, leadership in the all-inclusive segment, and a large pipeline of new resorts will extend our reach in existing and new markets, including in Europe, and further, accelerate our industry-leading net rooms growth.” 

In its statement, Hyatt said it expects to fund more than 80 percent of the purchase with a combination of $1 billion of cash on hand and new debt financings, and the remainder with about $500 million from equity financing. Further, the hospitality company has added that it has secured a $1.7 billion financing commitment from JP Morgan.

Cash proceeds from the $2 billion asset sale program are expected to be used to pay down debt, including debt incurred to fund the acquisition, Hyatt said, adding that the deal is anticipated to close in the fourth quarter of 2021.

After the completion of the deal, Hyatt will double its global resort footprint, the statement added. Apple Leisure Group and KKR did not immediately respond to a request for comment.

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