Hyatt to Buy Resort Operator Apple Leisure Group for $2.7B
Hyatt Hotels Corporation plans to buy luxury resort operator Apple Leisure Group (ALG) for $2.7 billion cash from KKR & Co. and KSL Capital Partners, the latest major hospitality deal as confidence in the industry returns.
The deal — expected to close in the fourth quarter of this year — doubles Hyatt’s resort footprint and adds about 100 properties in 10 countries, according to Hyatt.
ALG’s portfolio consists of several resort chains — including Secrets Resorts & Spas and Dreams Resorts & Spas — and currently has another 24 hotels in the pipeline.
KKR and KSL bought the Pennsylvania-based ALG, which was founded in 1969, from Bain Capital in 2017 for an undisclosed amount of money. ALG recently started expanding into Europe and bought a majority share in the Spanish hotel chain Alua Hotels & Resorts in 2018.
While the hospitality industry was decimated during the coronavirus pandemic, there have been some major hotel acquisitions in recent months as the market starts to bounce back.
In March, Apollo Global Management and VICI Properties bought The Venetian hotel on the Las Vegas Strip and the Sands Expo and Convention Center for $6.25 billion. And earlier this month, VICI picked up MGM Growth Properties for $17.2 billion.
Meanwhile, Blackstone Real Estate Partners and Starwood Capital Group closed on their roughly $6 billion purchase of hotel chain Extended Stay America in June.
For its purchase of ALG, Hyatt secured $1.7 billion from JPMorgan Chase and plans to fund the rest with cash on hand, new debt financings, and about $500 million from equity financing, the company said.
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