Mantra Group Ltd (ASX: MTR) entered into a binding agreement to sell all its shares to Accor SA (EPA: AC) at $3.96 on Thursday. The total offer is worth $4.02 per share if a 6 cent final dividend paid in 2017 is included.
Mantra Group CEO Bob East said shareholders were supportive of the $1.18 billion deal, which will require the consent of 75% of voting shareholders and a majority of shareholders to participate. A vote on the proposed merger will likely be held in March next year, via a scheme of arrangement.
The deal will create a hotel monolith with more than 300 hotels and more than 50,000 rooms, nearly five times the size of the closest competitor, Choice Hotels International Inc (NYSE: CHH). This will give the group a 15% market share.
Mantra Group shares closed at $3.88 on Thursday.
