Hilton to buy Scandic for £612m
23 April 2001
Britain's Hilton group has made a £612m cash-and-shares offer for Swedish hotel operator Scandic Hotels. Hilton offered 108 Swedish crowns in cash and 1.1238 Hilton shares for each Scandic share, representing a 30% premium to the closing price of Scandic shares on 20 April. After six weeks of negotiations the board of Scandic Hotels unanimously recommended shareholders and share option holders to accept the bid this morning. The offer has already been accepted by 32.2% of shareholders. The deal means Hilton has taken over management of 154 hotels, 133 of them in Scandinavia and 21 in non-Nordic European cities. It will re-name 30 of the hotels as Hiltons immediately. An industry observer said that Scandinavia was a hard market to get into because of strong loyalty to local brands. Hilton would acquire a huge mid-market customer base along with the Scandic brand name. Roland Nilsson, president and chief executive of Scandic, said: "Scandic's and Hilton's hotels are an excellent geographical fit and the groups have a similar focus and cultural affinity." Following the announcement, Hilton shares went up by 8% and Scandic shares rose by 30%.
