HNA to sell Radisson hotels to Shanghai Jin Jiang group for an estimated US$2 billion

China’s HNA Group, the conglomerate shedding assets to pay down debt, agreed to sell hotel company Radisson Holdings to Chinese hospitality giant Jin Jiang International Holding.

For HNA, the transaction represents another step in the unravelling of a global empire built on leverage-fueled deal making. The sale would add to the more than US$17 billion in divestments that the company has made this year, a tally that includes stakes in Hilton Worldwide Holdings and NH Hotel Group.

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Jin Jiang, which is controlled by the Shanghai government, is gaining a global chain that includes more than 1,100 hotels and brands such as Radisson, Prizeotel and Country Inn & Suites. Jin Jiang, which owns 12.3 per cent of France’s Accor, has been expanding overseas through acquisitions as Chinese tourists travel increasingly far afield. Earlier this year, it bought control of Indian chain Sarovar Hotels, following its acquisition of European hospitality provider Groupe du Louvre.

The Radisson purchase, complicated by tangled corporate structures, was announced Thursday and is expected to be completed by the end of the year. Bloomberg reported earlier this month that Jin Jiang was said to be weighing a bid for Radisson, which could fetch at least US$2 billion.

Jin Jiang intends to fully acquire Radisson Holdings, an umbrella company that owns Minnetonka, Minnesota-based Radisson Hospitality.

Before that, Jin Jiang will pay Radisson Hospitality 35 Swedish kronor (US$3.89) a share to buy a 51.15 per cent stake in Radisson Hospitality AB, a Stockholm-listed company, according to the statement. Separately, Jin Jiang plans to purchase up to 18.5 per cent of the listed company from HNA, and to launch a public tender for outstanding shares.

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The total price for the transactions wasn’t disclosed. The deals would make Jin Jiang the seventh-biggest hotel company in the world, with 344,000 rooms, according to lodging-data provider STR.

An HNA spokesman declined to comment.

HNA acquired its stake in Radisson in 2016 and oversaw an ambitious plan to update its brands, implement new booking and revenue-management technology, and expand its pipeline of development deals. In an emailed statement, John Kidd, chief executive officer of Radisson Hospitality, said he is hopeful those efforts would continue under new ownership.

“HNA has been extremely supportive of our business,” Kidd said. “Our efforts to transform the company to date have helped make Radisson Hotel Group an extremely attractive acquisition target. We see an immense opportunity with Jin Jiang International to join one of the largest hotel companies in the world.”