ADNH Acquires Entire 50% Stake in Compass Group’s JV Entities in UAE

Abu Dhabi National Hotels Company (ADNH) on Friday said that it has reached an agreement with Argentina-based Compass Group International (Compass) to acquire the latter’s entire stake of 50% in their joint venture entities operating in the UAE. Compass is the UAE’s largest provider of food services, cleaning and support services, and manpower supply.

The regulatory and legal formalities for the acquisition transaction are expected to be completed soon, and ADNH will keep the market informed of any developments in this regard, the company said in a regulatory filing with Abu Dhabi Exchange this morning.

This acquisition transaction is part of ADNH’s strategic plan to boost its revenues and profit   margins from key business segments, as the expected financial impact resulting from this acquisition transaction is achieving an additional annual net profit of approximately $27.23 million, the company added.

Abu Dhabi National Hotels has recently announced a collaboration with globally acclaimed hotel group Kempinski Hotels, signaling a pivotal moment for two of Dubai’s distinguished hotels.

This strategic alliance marks the commencement of an extraordinary rebranding initiative, solidifying ADNH’s commitment to delivering unparalleled hospitality experiences in the region.

Under this partnership, effective 1 January 2024, ADNH will operate these iconic properties under the banners of Kempinski Hotels. This transformative rebranding strategy is poised to redefine luxury in Dubai, promising an immersive experience that befits each hotel’s unique identity.

The hotels, including Kempinski The Boulevard Dubai (formerly known as Address Boulevard), and Kempinski Central Avenue Dubai (formerly known as The Address Dubai Mall), are set to undergo this remarkable transformation.

Revenue Up

The Compass Group’s organic revenue for the three months to 31 December 2023 increased by 11.7% with strong growth across all regions.  Like for like volume was better than the Group anticipated, especially in B&I, with all other growth drivers in line with its expectations when it reported the full year results.

As the Group focus on the significant structural growth opportunities in its core markets, it has acquired exciting new businesses and continued to reshape our portfolio.

Net acquisition expenditure in the first quarter was $352 million, of which most related to the completion of HOFMANNs in Germany.

In January 2024, the Group agreed to acquire CH&CO in the UK for an initial enterprise value of $600 million, with annual revenues of $570 million, and dispose of its small operations in China.

On 30 January 2024, the Group issued a $821.12 million sustainable bond, maturing in February 2031, the primary purpose of which is to refinance its existing $821.12 million bond maturing in July this year.

As at 7 February 2024, the Group has also completed $100 million of its share buyback programme of up to $500 million as announced at the full year results in November 2023.