France’s Louvre Hotels Group, a subsidiary of Chinese travel giant Jin Jiang, has acquired a majority stake in India’s mid-market warrior Sarovar Hotels, which has close to 75 hotels in the country.

Both parties flatly refused to disclose deal size or the percentage stake sale though industry speculation is it is around the Rs 340-crore mark and that Sarovar would have divested around 74 per cent. It may be recalled that Sarovar had held talks with other suitors including US based Wyndham Worldwide earlier but some of those negotiations had reportedly come unstuck because of disagreements in valuations or because the suitors wanted full control.

Private equity players Bessemer and New Vernon which had invested in Sarovar Hotels in 2005 and held a 30 per cent stake have now exited the group, confirmed Ajay Bakaya, executive director, Sarovar Hotels.

According to Bakaya, there will be no change in day to day management of the Sarovar Group and both he as well as executive chairman Anil Madhok who founded the chain, would continue to play a strong role.

The $1.6 billion European hotel group, Louvre which was acquired by the Chinese firm in 2015, already had a small presence in India through a joint venture inked in 2007 with real estate and hospitality development player Vimal Singh, and operates 22 hotels here under the Golden Tulip umbrella brand. That JV would continue separately and work in parallel with the partnership with Sarovar.

According to Pierre-Frederic Roulot, CEO, Louvre Hotels Group, “Gaining Size in India has become important for us and hence the acquisition. “ He pointed out that Sarovar had deep penetration in India with a presence in nearly 50 cities and that was an attractive point. “We are not an MNC but a multi local corporation and always prefer to work with local partners,” he said.

Sarovar operates three brands in India – Sarovar Premier, Sarovar Portico and Hometel in the mid market and upscale categories and also has two F&B brands The Geoffrey’s Pub and Oriental Blossom.

Louvre is the second largest hotel group in Europe and has six brands (Premiere Classe, Campanile, Kyriad, Tulip Inn, Golden Tulip and Royal Tulip) that straddle 1 star to 5 star segments. Roulot said that Louvre would leave the decision on which of its six brands would be brought to India to the Sarovar management. He also said the group would be open to taking Sarovar brand overseas and there was interest especially in the US.

Although Louvre does have hotel assets in France where it owns 250 hotels and in Germany and Poland where it acquired 21 hotels recently, Roulot said there were no immediate plans to acquire properties in India.

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