New Delhi: Mid-market focused hospitality brand Lemon Tree Hotels is reorganising its business into two distinct verticals, with an aim to focus on their core competencies, while helping to unlock value for investors. Lemon Tree Hotels Limited (LTHL) and its subsidiary Fleur Hotels are dividing its portfolio of rooms as LTHL aims to become a hotel management and development platform, while Fleur Hotels will spearhead the group’s expansion while holding the main hotel assets.
As part of a comprehensive reorganisation plan, LTHL and Fleur will allocate their portfolio of 154 owned and managed hotels and those in development into two distinct brands, with existing investors APG and Warburg Pincus holding 14.99% and 26.01% of LTHL and Fleur hotels, respectively, after the reorganisation is complete. Warburg Pincus is also looking to invest Rs.960 crore into Fleur after the transaction is complete. The promoter group will hold 22.28% in LTHL and 7.34% in Fleur after reorganisation.
“This scheme is intended to create a simplified, transparent, and growth-oriented structure for both companies, which we believe will enhance long-term value for our shareholders. We are also pleased to renew our partnership with Warburg Pincus, with whom we share a long history of building the foundations of Lemon Tree. This collaboration marks a defining moment as we enter the next phase of expansion for Fleur. With the Indian hospitality industry at an important inflection point, we look forward to leveraging Warburg Pincus’ global network and deep real estate and hospitality experience to scale responsibly, advance digital -led capabilities and embed sustainability as a core pillar of Lemon Tree’s and Fleur’s long-term growth journey.” Mr. Patanjali Govind Keswani, Founder and Executive Chairman of Lemon Tree and Fleur Hotels, said in a press release.
The reorganisation is expected to be completed within 12-15 months. Following that, Fleur Hotels will be listed as a separate entity on the BSE and NSE. Mr Patanjali Keswani will continue as the executive chairman of Fleur Hotels and eventually assume a non-executive role at LTHL.
