InSight

Exit and Growth Strategies for Middle Market Businesses

M&A Quarterly News In The Hospitality and Leisure Industry Sector

By David Hulett | Oct 23, 2018

The report below gives a good overview of the fourth quarter M&A activity in the Hospitality & Leisure Industry Sector.  M&A activity for North American based target companies in the Hospitality and Leisure sector for Q3 2018 included 43 closed deals, according to data published by industry data tracker FactSet.

One of the notable middle market transactions closed in August when Xenia Hotels & Resorts Inc acquired the business and assets related to the Ritz-Carlton hotel in Denver from The Ritz-Carlton Hotel Co LLC, a subsidiary of Marriott International Inc for US$100.2 million in cash. Funding for the transaction was provided by Xenia Hotels’ existing cash resources. The acquisition expands Xenia Hotels & Resorts Inc’s hotel management business. The Ritz-Carlton Denver is located in Colorado and owns and operates hotels and resorts.

Both business travel and leisure travel have been on a solid upward trend for decades now. This is driven, in part, by a growing economy and increased efficiencies in booking travel.

Industry Indicators

  • The average US retail price for diesel and regular gas, which determines airline prices and domestic auto travel, rose 16.3% and 5.5%, respectively, in the week ending September 10, 2018, compared to the same week in 2017.
  • US personal income, which drives consumer ability to pay for luxury expenditures like travel, rose 4.7% in July 2018 compared to the same month in 2017.
  • Total US revenue for travel arrangement and reservation services fell 6.1% in the second quarter of 2018 compared to the previous year.

Posted by David Hulett.

Read the Entire Hospitality & Leisure 4th Quarter Newsletter Here


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