The total scale does not exceed 500 million, the establishment of a number of industrial investment**, the main investment in hotel management companies - in the latest announcement, SSAW Boutique Hotel disclosed the path and strategy of foreign investment.
Wine Management Finance has noticed that in the past few years, industrial investment related to the hotel industry has appeared from time to time, but there is still a gap in frequency and scale compared with other fields. In the process of capitalization of China's hotel industry, various forms including industrial investment, mergers and acquisitions, IPOs, etc., are bound to become an important starting point.
For SSAW Boutique Hotel, through financial tools and means, it can accelerate the expansion of mid-to-high-end select-service hotels, and provide project reserves for the company's future industrial integration and mergers and acquisitions. For many regional wine management companies, it may also be a good choice to do a good job in their own product characteristics, deeply cultivate a certain market, and get close to the capital market with the help of this wave.
For the entire Chinese hotel industry, capitalization can realize the chain of the industry, the improvement of profit margins, and the optimization and adjustment of the industrial structure, which is of great practical significance.
Let's take a look at SSAW Boutique Hotel's investment**.
Junting mentioned in the announcement that Nanjing Junhui Investment Management Co., Ltd., a second-level subsidiary of the company, plans to set up a number of private equity investments in the hotel industry, with a total scale of no more than 500 million yuan, of which the total investment of Junhui Investment does not exceed 50 million yuan.
SSAW Hotel believes that the company's participation in the establishment of private equity investment in the hotel industry is to make full use of the investment ability and resource integration ability of professional investment institutions on the basis of the company's industry experience, and expand the scale of investment through various financial tools and means.
It is worth noting that one of the industrial private equity investments**, Guangdong Zhongbao Jiayun Equity Investment Partnership (Limited Partnership), has obtained the "Private Equity Investment** Filing Certificate" from the China **Investment** Industry Association on December 15, 2023, with the record code: SAEM66. Follow-up** will be recruited step by step according to the specific implementation situation.
The investment industry is to make equity investments in commercial hotel management companies and other investments permitted by applicable law, and to carry out the operation and management of hotel property projects through such companies and their subordinate project companies.
In terms of investment geography, the underlying property projects to be invested in should be located in municipalities directly under the central government, key provincial capitals and strong second-tier cities.
SSAW Hotel has always been regarded as a representative of "small but beautiful" in the industry, but this company no longer hides its ambition to become bigger and stronger.
After the acquisition of Narada and Jinglan last year, SSAW Hotel's products cover two categories: vacation and business travel, forming a mid-to-high-end multi-brand matrix of business and vacation.
Among them, Junting mainly expands its directly-operated stores, and at the same time carries out the output of asset-light entrusted management modeJunlan mostly expands in the mode of entrusted management;The newly launched "Junting Shangpin" plans to be launched into the franchise market when the time is ripe;At the same time, the company is opening up the possibility of joining other brands.
The above is just an adjustment of the internal business strategy. In terms of the integration of external resources, the above announcement mentionsThe establishment of private equity investment** in related industries can accelerate the pace of expansion of mid-to-high-end select-service hotels, and at the same time provide project reserves for the company's future industrial integration and mergers and acquisitionsto strengthen and consolidate the company's leading position in the mid-to-high-end select-service hotel industry.
In other words, this ** is to pave the way for the future merger and acquisition integration of Junting, especially for the mid-to-high-end select-service hotel field.
In the view of Wine Management Finance, the hotel industry needs more channels to move towards capitalization. In the form of industrial investment funds alone, the hotel industry appears from time to time, but the overall scale and frequency are far inferior to other industries.
Judging from the public information, in January 2021, the Jin Jiang Oriental Hotel Industry ** project was officially signed. The total amount of the project is 6 billion yuan, and the first phase is 600 million yuan. The project is jointly initiated and established by Shanghai Jinjiang International (Group)**Oriental Ruichen**Management***Changshu Economic Development Zone, and the main investment direction is to acquire or lease hotel properties, accurately matching Jinjiang's brands for upgrading;At the same time, we will pay attention to some investment opportunities in the form of hotel derivatives, including long-term rental apartments, pension apartments, etc.
In May 2019, Huazhu Group and EBA jointly established a new investment platform, Anzhu Residence, and jointly initiated the establishment of Pan-residential Real Estate Investment**, which invests in residential real estate properties such as hotels and apartments in China. In January of the previous year (2018), Huazhu also established a joint venture with TPG to participate in the acquisition of heavy hotel assets.
The focus of the two projects is different. The partnership with TPG is a joint venture for a single project, while Settle Here is an in-depth and systematic coverage of assets in the accommodation industry.
Earlier, in 2017, Zoomlion established the first private equity company focusing on luxury resort investment in China and entered the cultural tourism and resort industry.
A comparison of industrial investment in other sectors can give a clearer picture of the situation of the hotel industry.
Although the prefabricated food industry is still in the development period, it has ushered in a wave of capitalization. Almost every province has an investment in the prepared food industry**. Some large prefabricated food provinces, cities and even some urban areas have also launched corresponding industrial investment**. The upsurge of the capital side, in turn, promotes the rapid development of the industrial side.
For the hospitality industry,In order to adjust the industrial structure and industrial level, the integration of the stock market is particularly important, and the capitalization operation is an important means to optimize the industrial structure of the hotel industry. Large hotel groups can achieve their own growth through mergers and acquisitions, while high-quality regional hotel groups are expected to accelerate their own scale expansion and improve the quality of development after obtaining the blessing of capital. In this process, the entire industry accelerates the survival of the fittest.
In August this year, "Wine Management Finance" wrote an article "Capital is paying close attention to Henan Hotel Group", detailing the attention of the outside world to Henan hotels.
In fact, China's hotel industry urgently needs the support of the capital market and the need to embrace capitalization.
First of all, the debt ratio of China's private accommodation enterprises continues to rise.
Yang Honghao, director of the Industry Research Institute of the China Tourism Academy, cited data in the article "The Road and Future Direction of Capitalization of Chinese Hotel Groups" written at the beginning of this yearIn 2011, the liabilities of private accommodation enterprises were 7546%, and then gradually increased, exceeding 80% in 2017 and reaching 86 in 201978%, and in 2020, it increased to 88 due to the epidemic48%, and the debt burden continues to ballooze.
For unlisted private hotel groups, the high debt ratio, coupled with the fact that their financing costs are higher than those of state-owned enterprises, will inevitably compress the profits of hotel groups. If it can be successfully listed, whether it is the financing obtained from the IPO or the financing obtained from the additional issuance, its capital cost is significantly lower. Therefore, low-cost financing, reducing debt ratio, optimizing financial structure, and improving financial statements are also important motivations for chain hotels to want to go public.
Secondly, the hotel industry should embrace the capital market with the help of various forms. This includes, but is not limited to, IPOs, mergers and acquisitions, hotel REITs, etc.
For example, Chengdu Sports Industry Investment Group acquired the listed company Rhine Sports, and gradually put its Chengdu cultural and tourism assets into the listed company. The latter's main business is alpine skiing sports business, ropeway cable car business, hotel business, etc.;At the same time, in view of the restrictions on A-share IPOs, Hong Kong stock listings can be sought.
In fact, of all the capitalization paths, hotel REITs are more noteworthy.
This model has not yet been implemented in the field of hotels in China, but there is a great chance of it being implemented in the future. Especially in the absence of the epidemic factor, the chain rate of the entire industry has increased, and the profit margin of the hotel industry has increased, creating conditions for the issuance of hotel REITs.
For the hotel side,All that needs to be done is to have a clear title to the hotel and have a stable cash flow and good profitability. Others just have to wait for the wind to come.
Co-ordinator丨Lao Dian Editor丨A Xin.
Part of the article is *** on the Internet. Original content of Wine Management Finance, unauthorized and prohibited