A Thai group practically unknown in Europe and the United States has won the jewel in the crown, the flagship company of the Spanish urban hotel industry: NH Hotel Group. Is about Minor International, a conglomeration of hotels, restaurants and fashion stores that aspires to become a relevant player in the European hosting business through the purchase of 94.1% of the Spanish chain, its first relevant operation after the incursion into Portugal through Tivoli. The Asian company, with revenues of 1,500 million euros and an EBITDA of 320 million in 2017, is ranked 68th in the world ranking by number of rooms, while NH is in 28. United will rise to the 19th position, according to Minor.
After having designed a very skilful strategy to guarantee the triumph of the OPA launched to the company presided by Alfredo Fernández Agras at 6.3 euros per share, previously acquiring shares of the British investment fund Oceanwoods and the Chinese hotelier HNA, according to Iván San Félix, analyst of Renta 4 Banco; the plans of the Thai holding go through maintaining, at least during the next 12 months, its management team, its brands, staff and business plan, which provides an ebitda of 260 million euros this year and 285 million next, besides continuing with her in the stock market. In any case, "could propose to modify the brand of some NH hotels by Minor brands, and vice versa," reads the brochure of the OPA.
His goal was not to have such a high participation. You will look for an institutional partner
A small fish
The Thai has 161 hotels in 40 markets (especially in Asia, Africa, Australia, the Middle East and, to a lesser extent, in Europe and America) compared to 380 in Spain, mainly in Europe and America. So the analysts consulted see the complementarity of the portfolios, although it is more difficult for them to visualize the synergies that the Asian group says will be derived from the union, beyond Portugal or Brazil, where they share assets. Minor talks about taking advantage of the client bases of both hotels to increase the demand of Asian tourists to Europe and vice versa, but does not offer data of how much or how. The same as regarding the synergies in costs, to which it also refers.
"Until Minor does not provide information on the joint plan, NH's share will remain weak," predicts Francisco Rodríguez, an analyst at Banco Sabadell. In a week the chain has fallen 12% on the Stock Exchange, up to 5.40 euros per share. "With such a strong shareholder, NH leaves the radar of investors," says an expert who asks for anonymity and says that the shareholders have flocked to the offer because, when taking for granted the success of the takeover, they did not see that the company had a better future plan with Minor than it had alone. The market does not like holdings and usually applies discounts, another analyst appreciates. The Thai group generates 53% of its income in the hotel business and the remaining 47% of sales come from its 2,000 restaurants and 416 fashion stores.
For Iván San Félix, Minor has gone from braking, because it aspired to control between 51% and 55% of the capital of NH, instead of the 94.1% with which it has remained finally. "It is not the same to buy 55% of NH with about 1,400 million euros of debt, as planned, to acquire almost 100% with 2,400 million debt," say sources close to the board of directors of the Spanish hotel, which remember that alarms about the cost of financing the takeover jump from the possession of 65% of the shares.
Although the spokespersons of Minor affirm that Thai is comfortable with the result of the OPA and has 100% of the financing to face it, the group has decided to postpone the sale of "oversubscribed" shares to try to stop its fall on the stock market. In the next months, they maintain, "there will be no problem to find an institutional financial partner to accompany them". But in the market it does not look so clear.
"Now Minor has to finance the operation. Have enough credit, otherwise the conditions of the covenants will be [compromisos con los acreedores] in the future, "says an analyst, who justifies the fall of the stock because, contrary to values such as Meliá, which has sold 18% on the stock market so far this year, NH had not lost value because it was subject to the price of the opa. His recommendation, however, is to buy NH titles, since his rating is low. Renta 4 puts the target price at 6.80 euros. We will have to wait to see it. "After the fall of 12%, although there is potential, we do not see short-term catalysts," says Francisco Rodríguez.
"NH is a chain with perspectives. Its managers have undergone a process of restructuring very strong in recent years, is doing well and will continue to do well, increasing prices per room and profitability, "analysts estimate. Albert Grau, a partner at Magma Hospitality Consulting, believes that the operation of Minor is positive, has been closed at a reasonable price and will bring value and stability to NH, one of the chains that have opted most for the repositioning of assets and the technology lately, he says.
2007 Hesperia reaches 25% of NH's capital.
2009 The group enters losses (41 million euros) and increases capital.
The savings banks syndicate their shares, of 20.74%.
2011 Gabriele Burgio is replaced by Mariano Pérez Claver in the presidency. The Chinese hotelier HNA enters the capital with 20%.
2012 The chain refinances its debt. Federico González Tejera replaces Pérez Claver. Their losses reach 292 million.
2013 NH makes an ERE of more than 600 employees. The stock boxes come out.
2015 Go back to benefits. Enter Oceanwood in the capital and appoint Alfredo Fernández Agras president. Along with Hesperia, take HNA out of the council.
2017 Barceló proposes a merger with NH that valued its share at 7.08 euros. It is rejected.