Singaporean sovereign wealth group GIC has agreed to purchase a majority stake in Mediterranean luxurious resort operator Sani/Ikos Group in a buyout that values the corporate at €2.3bn, the largest deal within the European resort sector because the Covid-19 pandemic.
A clutch of traders, together with US-based asset supervisor Oaktree Capital, Goldman Sachs’ asset administration unit and London-based non-public fairness agency Hermes GPE, will exit the enterprise after promoting their stakes to GIC. They first got here on board when the resort group was fashioned by a merger in 2015.
Since 2015, the revenues of the Greece-headquartered group, which owns and operates 10 beachfront resorts with round 2,700 rooms throughout Greece and Spain, have greater than tripled from £88mn to a projected determine of €319mn for this 12 months. Sani/Ikos can also be pushing forward with a five-year, €900mn growth plan, which can add 4 extra redeveloped resorts to its portfolio.
The acquisition by GIC comes as fears develop over a recession throughout Europe this winter, because the vitality disaster ensuing from Russia’s invasion of Ukraine has drained shopper confidence. Most of Sani/Ikos’s clientele is drawn from Germany and the UK. However the Singapore state fund is betting on the luxurious sector defying the downturn.
Final month, Fitch Rankings lower its outlook for the group’s long-term debt to “unfavorable” from “secure”, however saved the score at B-. It stated the enterprise’s money circulation might come beneath strain from its giant growth plans however that it benefited from “decrease demand sensitivity” to a shopper downturn and “a document of above-average restoration post-pandemic” in contrast with friends within the luxurious resort sector.
Lee Kok Solar, chief funding officer of GIC’s actual property division, stated the “glorious hospitality experiences” for company helped Sani/Ikos stand out. “We consider this funding will generate resilient returns and is testomony to our confidence within the Greek and wider European tourism sector over the long run,” he added. The deal is anticipated to shut by the tip of the 12 months.
GIC advised the FT in July it was focusing its funding technique on inflation-protecting companies which may cross on value will increase to clients. This 12 months, GIC has taken stakes within the Paddington workplace property in London and college lodging suppliers The Scholar Lodge and Scholar Roost.
Sani/Ikos traces its origins to the Sani Membership, a resort opened in 1971 by Greek hotelier Anastasios Andreadis, which expanded over the next many years.
Andreadis’s sons — Stavros and Andreas — grew to become main shareholders within the group when it was fashioned from a merger of Sani Resorts and Ikos Resorts in 2015, alongside former Oaktree government Mathieu Guillemin. All three will keep on as shareholders and proceed working with the enterprise.
Andreas Andreadis and Guillemin, who function co-CEOs, stated in a joint assertion that the corporate had “led a exceptional path” of development over latest years “regardless of the pandemic”. Bookings throughout the ten resorts this 12 months have been up 52 per cent on final 12 months and 57 per cent on pre-pandemic ranges. The corporate added that early 2023 bookings have been robust.
“We will now solidify our main place throughout the Mediterranean, to the advantage of our shareholders, our individuals and the communities the place we function,” they added.