SYDNEY—France’s Accor SA has made a bid of approximately $1.2 billion to acquire Australia’s Mantra Group Ltd.
Mantra confirmed there is “an indicative and non-binding proposal from Accor SA in relation to a potential control transaction, to be implemented by way of a Mantra scheme of arrangement, at $3.96 cash per share—on a fully diluted basis—being $4.02 per share less the final FY17 dividend that has already been paid, and including a potential special dividend,” according to a statement released to the Australia Stock Exchange.
The hotel company has granted Accor access to due diligence to determine if a transaction can be agreed upon and recommended unanimously by the Mantra board. If the deal is cemented, it would advance Accor’s efforts to add properties in the mid- and upscale markets, especially in the Asia-Pacific region, according to Bloomberg Intelligence analyst Margaret Huang.
It’s too early to tell as the discussions are “incomplete and any entry by the parties into binding transaction documents remains subject to a number of conditions,” such as board approval on both sides and agreement on documentation. Then, the proposal would be subject to regulatory approvals and other conditions to be determined.
Mantra has retained Highbury Partnership as financial adviser and Baker McKenzie as legal adviser to assist it in responding to the proposal.