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Accor Buys Luxury Fairmont Brands as Hotel Deals Heat Up

  • Price said to be high compared to Marriott's Starwood purchase
  • FRHI deal gives Accor access to valuable U.S. luxury markets
Updated on

Accor SA may be paying too much to acquire the owner of the luxury Fairmont, Raffles and Swissotel brands as the French company tries to protect itself against online competitors and expand its U.S. and Asian reach.

"While we see a long-term rationale in the deal -- stronger U.S. and luxury positioning, scale and enhanced growth potential -- we struggle to reconcile these positives with the price that Accor is paying, which we consider to be very high," Barclays analyst Vicki Stern wrote in a note on Thursday.