The deal, originally announced in May, will now see the Chinese group pay €330m for the stake, compared to the €432m originally offered - based on €5.35 per share against €7, which still represents a 64% premium on NH’s current share price of €3.26.
The firm said in a statement it will carry out a capital increase, issuing 60m shares at a price of €5.35, and making HNA the second-largest stakeholder after Hesperia, with 24%. This will be carried out before 15 December, providing NH with a much-needed injection of liquidity and allowing it to reduce its debt to €787m from the present €1.1bn. Much of this matures in 2012. The announcement of the new terms led to a 19% rise in the share price to €3.88 Monday.
The deal foresees the opening of two or three NH-brand hotels in China in 2012, with the Spanish chain keen to open “dozens” of hotels in a high-growth hospitality market over the coming years. HNA, the parent company of Hainan Airlines, operates 50 hotels in China, some of which will be rebranded as NH, within the four-star urban hotel market.
NH currently has 395 hotels in half a dozen European countries, as well as in North and South America, and 60,000 hotel rooms in Spain. Having put the brakes on expansion plans due to the crisis-induced drop in tourism, the firm has sold 13 hotels and other assets for €344m during the last two years. pie