Travel + Leisure Co. Continues Brand Portfolio Expansion with Acquisition of Accor Vacation Club

Rhea-AI Summary

Travel + Leisure Co. (TNL) acquires Accor Vacation Club for US$48.4 million, expected to be immediately accretive to earnings. The deal includes 24 resorts and nearly 30,000 members, with Travel + Leisure Co. gaining exclusive rights to develop new vacation ownership clubs and products in the Asia Pacific, Middle East, Africa, and Turkey regions under the Accor Vacation Club brand.

Insights

Market Research Analyst

The acquisition of Accor's vacation ownership business by Travel + Leisure Co. signifies a strategic expansion in the vacation ownership segment, a niche of the broader hospitality industry. This segment involves the sale of timeshare properties, where multiple parties hold rights to use the property and each owner of the same accommodation is allotted their period of time.

The transaction's value at US$48.4 million and the immediate accretive nature to earnings suggest a well-valued deal that could enhance shareholder value. The acquisition not only increases Travel + Leisure Co.'s asset base but also provides a new revenue stream through the licensing agreement with Accor. The deal's strategic importance lies in its expansion into the Asia Pacific, Middle East, Africa and Turkey regions, areas with growing tourism industries and rising disposable incomes. The partnership will leverage Travel + Leisure Co.'s global platform, potentially increasing its market share in these regions.

This move could also signal a consolidation trend within the vacation ownership market, hinting at the potential for future mergers and acquisitions. By tapping into Accor's established brand recognition in the Asia Pacific, Travel + Leisure Co. could see an uptick in its customer base and further diversification of its portfolio, reducing reliance on traditional markets.

Financial Analyst

The financial implications of the acquisition are significant for Travel + Leisure Co.'s investors. With the deal being immediately accretive to earnings, it indicates that the acquisition will contribute positively to the company's profits from the outset. This is a strong signal to investors that the company is not only growing its revenue base but also enhancing its profitability.

Moreover, the acquisition cost of US$48.4 million should be weighed against the potential long-term income from nearly 30,000 new members and the sales of new timeshare products. The licensing fee structure with Accor could provide a steady income stream while also aligning the interests of both companies. Investors should monitor the integration process and look for synergies that may result in cost savings or increased sales efficiency.

It is also worth noting that the vacation ownership market is highly sensitive to economic cycles. Therefore, while the short-term outlook may be positive, investors should consider the potential impact of economic downturns on discretionary spending in the long term.

Hospitality Industry Expert

The acquisition of Accor Vacation Club by Travel + Leisure Co. represents a significant shift in the competitive landscape of the hospitality industry, particularly in the vacation ownership market. Accor's strong presence in the Asia Pacific region, with more than 1,600 hotels, provides Travel + Leisure Co. with a formidable foothold in a burgeoning market. The timeshare industry is highly competitive and brand recognition plays a crucial role in attracting and retaining customers.

Travel + Leisure Co. will benefit from Accor's established brand equity, which can be leveraged to create new vacation ownership products tailored to the cultural and regional preferences of consumers in Asia Pacific, Middle East, Africa and Turkey. The development of new clubs and products under the Accor Vacation Club brand could also cater to a demographic that is increasingly seeking experiential travel and flexible vacation options.

Additionally, the integration of the Accor Vacation Club into Travel + Leisure Co.'s existing operations will require careful management to ensure that the high standards of service associated with both brands are maintained. The success of this acquisition will largely depend on the seamless blending of Accor's vacation ownership business with Travel + Leisure Co.'s global platform and the effective cross-regional operational management by the president and managing director of international operations, Barry Robinson.

• Travel + Leisure Co. vacation ownership segment grows with the acquisition of the vacation ownership business of global hospitality group, Accor, for US$48.4 million
• Deal is expected to be immediately accretive to Travel + Leisure Co. upon closing
• Continues delivering on the Travel + Leisure Co. strategic priority of vacation brand portfolio expansion
• Acquisition of existing business helps the two companies establish a relationship to develop new timeshare products in the Asia Pacific, Middle East, Africa and Turkey regions under the Accor Vacation Club brand, leveraging the Travel + Leisure Co. global platform

ORLANDO, Fla. & GOLD COAST, Australia--(BUSINESS WIRE)-- Travel + Leisure Co. (NYSE:TNL), the world’s leading membership and leisure travel company, announced an agreement to acquire the vacation ownership business of global hospitality giant Accor (AC:FP) for US$48.4 million. The acquisition is expected to close in the first quarter of 2024 and to be immediately accretive to Travel + Leisure Co. earnings upon completion.

Travel + Leisure Co. Continues Brand Portfolio Expansion with Acquisition of Accor Vacation Club (Photo: Business Wire)

Under the terms of the deal, Travel + Leisure Co. will acquire Accor’s vacation ownership business, Accor Vacation Club, representing 24 resorts and nearly 30,000 members. Accor is the largest international hotel chain in the Asia Pacific with more than 1,600 hotels in operation, giving the brand a distinct advantage in its recognition across the world’s most populous region. Accor will receive a percentage of vacation ownership sales revenue as a licensing fee under the exclusive licensing agreement.

Travel + Leisure Co. also receives the exclusive rights to develop new vacation ownership clubs and products utilizing the Accor Vacation Club brand across a region including Asia Pacific, Middle East, Africa and Turkey.

Upon deal closing, the Accor Vacation Club business line will report into Barry Robinson, president and managing director of international operations for Travel + Leisure Co., based in the company’s Singapore office. “We are excited about building on the legacy of Accor Vacation Club, which has been a recognized and respected presence in the region for more than 20 years,” Robinson said. “We are a partner of choice for leading hospitality brands because we are able to individually curate their brands and maintain their unique offerings to travelers. Utilizing our experience and the scale of our global platform, we will be able to accelerate the growth of this vacation club business by delivering outstanding vacation experiences for current and future members.”

The acquisition will create a new line of business for Travel + Leisure Co. as Accor is added to the company’s portfolio of brand affiliations, including Wyndham, Margaritaville, and Sports Illustrated. The addition of Accor Vacation Club to the Travel + Leisure Co. international portfolio increases its membership to more than 100,000 in the Asia Pacific region and grows its club resort count by approximately 40 percent to 77.

The Accor Vacation Club resorts are distributed across Australia, New Zealand and Indonesia under Accor brands Peppers, MGallery, Grand Mercure, The Sebel, Novotel, Mantra and Mercure in locations including tropical Nusa Dua in Bali, Indonesia, magnificent Darling Harbour in Sydney, Australia, and the capital of South Pacific adventure tourism, Queenstown in New Zealand.

Duncan O’Rourke, Chief Executive Officer Accor MEA APAC – Premium, Midscale and Economy Division, said the agreement highlights Accor’s ongoing business evolution. “The transaction is aligned with our asset-light strategy and allows us to monetise our existing business and enhance recurring fee streams, supporting the continued growth of our franchised hotel network across Asia Pacific,” said O’Rourke. “By selling the business to a trusted and proven operator with significant scale, we will be able to grow the business and continue to drive outstanding hospitality experiences for Accor Vacation Club members.”

For more information visit travelandleisureco.com/avc.

About Travel + Leisure Co.

As the world’s leading membership and leisure travel company, Travel + Leisure Co. (NYSE:TNL) transformed the way families vacation with the introduction of the most dynamic points-based vacation ownership program at Club Wyndham, and the first vacation exchange network, RCI. The company delivers more than six million vacations each year at 245+ timeshare resorts worldwide, through tailored travel and membership products, and via Travel + Leisure GO - the signature subscription travel club inspired by the pages of Travel + Leisure magazine. With hospitality and responsible tourism at the heart of all we do, our 19,000+ dedicated associates bring out the best in people and places around the globe. We put the world on vacation. Learn more at travelandleisureco.com.

About Accor

Accor is a world leading hospitality group consisting of more than 5,100 properties and 10,000 food and beverage venues throughout 110 countries. The group has one of the industry’s most diverse and fully-integrated hospitality ecosystems encompassing luxury and premium brands, midscale and economy offerings, unique lifestyle concepts, entertainment and nightlife venues, restaurants and bars, branded private residences, shared accommodation properties, concierge services, co-working spaces and more. Accor also boasts an unrivalled portfolio of distinctive brands and approximately 260,000 team members worldwide. Over 68 million members benefit from the company’s comprehensive loyalty program ALL - Accor Live Limitless - a daily lifestyle companion that provides access to a wide variety of rewards, services and experiences. Through its Planet 21 – Acting Here, Accor Solidarity, RiiSE and ALL Heartist Fund initiatives, the group is focused on driving positive action through business ethics, responsible tourism, environmental sustainability, community engagement, diversity and inclusivity. Founded in 1967, Accor SA is headquartered in France and publicly listed on the Euronext Paris Stock Exchange (ISIN code: FR0000120404) and on the OTC Market (Ticker: ACCYY) in the United States. For more information visit group.accor.com or follow Accor on Twitter, Facebook, LinkedIn and Instagram.

Forward Looking Statements

This press release includes “forward-looking statements” as that term is defined by the Securities and Exchange Commission (“SEC”). Forward-looking statements are any statements other than statements of historical fact, including statements regarding our expectations, beliefs, hopes, intentions or strategies regarding the future. In some cases, forward-looking statements can be identified by the use of words such as “will,” “expects,” “future,” or other words of similar meaning. Forward-looking statements are subject to risks and uncertainties that could cause actual results of Travel + Leisure Co. and its subsidiaries (“Travel + Leisure Co.” or “we”) to differ materially from those discussed in, or implied by, the forward-looking statements. Factors that might cause such a difference include, but are not limited to, risks associated with: the future prospects and plans for Travel + Leisure Co., including our ability to successfully market and sell Accor Vacation Club products to current and future members; our ability to compete in the highly competitive timeshare and leisure travel industries, including through Accor Vacation Club; the health of the travel industry and declines or disruptions caused by adverse economic conditions (including inflation, higher interest rates, and recessionary pressures), terrorism or acts of gun violence, political strife, war (including hostilities in Ukraine and the Middle East), pandemics, and severe weather events and other natural disasters; adverse changes in consumer travel and vacation patterns, consumer preferences and demand for our products; increased or unanticipated operating costs and other inherent business risks; our ability to comply with financial and restrictive covenants under our indebtedness; our ability to access capital and insurance markets on reasonable terms, at a reasonable cost or at all; maintaining the integrity of internal or customer data and protecting our systems from cyber-attacks; uncertainty with respect to potential resurgences of the novel coronavirus global pandemic (“COVID-19”); and those other factors disclosed as risks under “Risk Factors” in documents we have filed with the SEC, including in Part I, Item 1A of our Annual Report on Form 10-K for the fiscal year ended December 31, 2022, filed with the SEC on February 22, 2023. We caution readers that any such statements are based on currently available operational, financial and competitive information, and they should not place undue reliance on these forward-looking statements, which reflect management’s opinion only as of the date on which they were made. Except as required by law, we undertake no obligation to review or update these forward-looking statements to reflect events or circumstances as they occur.

View source version on businesswire.com: https://www.businesswire.com/news/home/20240130191390/en/

Media contacts:

Chris Logan

Travel + Leisure Co.

Asia Pacific

M: +61 424 134 869

chris.logan@travelandleisure.com

Steven Goldsmith

Travel + Leisure Co.

North America

+1 407.626.5882

steven.goldsmith@travelandleisure.com

Claire Haigh

VP PR & Communications MEA APAC

Premium, Midscale, Economy

M: + 61 438 681 446

claire.haigh@accor.com

Investor contacts:

Kendrick Calilao

Travel + Leisure Co.

+1 407.626.4487

ir@travelandleisure.com

Source: Travel + Leisure Co.

FAQ

What did Travel + Leisure Co. acquire from Accor?

Travel + Leisure Co. acquired the vacation ownership business of Accor, including 24 resorts and nearly 30,000 members.

How much did the acquisition cost?

The acquisition of Accor Vacation Club by Travel + Leisure Co. cost US$48.4 million.

What are the expected benefits of the acquisition for Travel + Leisure Co.?

The acquisition is expected to be immediately accretive to Travel + Leisure Co.'s earnings upon completion.

In which regions will Travel + Leisure Co. develop new vacation ownership clubs and products under the Accor Vacation Club brand?

Travel + Leisure Co. will develop new vacation ownership clubs and products in the Asia Pacific, Middle East, Africa, and Turkey regions.

Who will oversee the Accor Vacation Club business line after the deal closing?

Barry Robinson, president and managing director of international operations for Travel + Leisure Co., will oversee the Accor Vacation Club business line.