Icamap and Ivanhoé Cambridge have given an update on their takeover of easyHotel after building up a 68.8% stake.
The private equity real estate company and its Canadian partner told the financial market they now own 68.8% following a recommended mandatory cash offer. However, the takeover has been opposed by easyHotel’s founder Stelios Haji-Ioannou, who previously urged shareholders not to do anything to allow the takeover. Some 27.9% of easyHotel's share capital is still held by easyGroup, the private investment vehicle of Haji-Ioannou and owner of the ‘easy’ family of brands, leaving a balance of 3.4% minority shareholders.
Fund manager Icamap and Ivanhoé Cambridge, which is a real estate subsidiary of Caisse de dépôt et placement du Québec, said in their statement they had ‘finalised’ the takeover of the group that started in 2004 and has the distinctive orange branding of the easy family of companies. There are 39 hotels in total with 3,672 rooms. Of the 39, 27 are franchised and 12 are owned. The group went public on the smaller London stock exchange called AIM in 2004.
Demonstrating its progression in share ownership, the two private investors said as at 2 August 2019, the Icamap Fund was the largest shareholder in easyHotel with 38.7%, through two equity placings in 2016 and 2018, in which it provided most of the capital easyHotel was seeking to raise at the time.
For some time, Icamap had believed that finding another equally supportive investor to share its commitment to developing easyHotel was a priority for the company. ICAMAP therefore partnered Ivanhoé Cambridge, an existing investor in the Icamap Fund, to achieve its ambitions. Ivanhoé Cambridge, like Icamap, said it ‘recognises that easyHotel needs significant investment to ensure it can fulfil its potential as a leading European budget hotel company’.
On 5 August 2019, Ivanhoé Cambridge and the Icamap Fund launched a recommended offer on the share capital which the Icamap Fund did not own. On 1 October 2019, Citrus UK Bidco Limited, a newly incorporated company owned by Ivanhoé Cambridge and the Icamap Fund, received acceptances for the offer which, together with the shares acquired during the offer, resulted in Ivanhoé Cambridge and the Icamap Fund owning together 68.8% of easyHotel’s share capital.
The offer enabled shareholders to exit from an illiquid stock at a 34.8% premium and resulted in ‘greater clarity’ of ownership and direction for the company and its management team.
Each consortium member will appoint one board member in addition to Harm Meijer, one of the founding partners of Icamap, who has been on the board since March 2018.
Commenting on the closure of the offer, Karim Habra, head of Europe for Ivanhoé Cambridge, said: ‘This investment perfectly illustrates our innovative value-creation strategies through a complex operation. The easyHotel concept is pioneering and visionary. It is already a strong brand and we believe in its growth potential on a pan-European scale at a time when mass tourism is growing rapidly every year.’
Guillaume Poitrinal and Harm Meijer, founding partners of Icamap, added: ‘Following the very strong level of acceptances of the Offer, we look forward to working with easyGroup and the other shareholders to grow and expand the business and help easyHotel realise its full potential.’