EasyHotel has appointed François Bacchetta as CEO, replacing Guy Parsons, who left the company in November.
Baccetta joins the super-budget hotel brand from sister company easyJet, where he was country director for France and Italy, and is expected to drive the flag’s growth in Europe.
Bacchetta was at easyJet for 15 years, having previously held a number of senior marketing positions at global cosmetics group L’Oréal, including responsibility for territories in South East Asia, as well as Europe.
Harm Meijer, non-executive chairman, easyHotel, said: “Following a comprehensive search, we are pleased that François is joining us to lead easyHotel in its aspiration to become a European leader in the super-budget hotel segment. He knows the easy brand and understands its values extremely well. He also brings a wealth of experience in developing businesses, strategy, business optimisation, leadership, marketing and revenue management.”
Bacchetta said: “easyHotel is a business I greatly admire and I am thrilled to be appointed. With a strong hotel network established in the UK, I believe this is a very exciting time for the brand and I look forward to leading the expansion in Europe as the group seeks to become a leader in the budget hotel space.”
October last year saw a consortium of Ivanhoé Cambridge, a real estate subsidiary of Caisse de dépôt et placement du Québec, and ICAMAP, a real estate fund manager, announce that they now controlled 68.8% of easyHotel.
With 27.9% of easyHotel’s share capital held by easyGroup, the private investment vehicle of Sir Stelios Haji-Ioannou, the creator and owner of the ‘easy’ family of brands, this left a balance of 3.4% minority shareholders.
Sir Stelios had previously objected to the takeover move, describing it as “very low”. Once the deal was declared unconditional, he called on ICAMAP/Ivanhoe to replace “all the directors, whose advice to shareholders to accept the undervalued offer at 95p was plainly wrong”.
He added: “While I applaud the ICAMAP/Ivanhoe’s huge vote of confidence in easyHotel – I must repeat my insistence that it remains a listed company on the London market. It’s now clear that easyGroup’s 28% blocking minority stake and ICAMAP’s low ball offer has made it impossible for easyHotel to be taken private. Therefore this exercise was an object lesson in pointlessness. By taking their stake from 38% to 68%, ICAMAP have achieved little other than to enrich lawyers and bankers to the tune of £1.5m. What a colossal waste of money!
“But we are where we are. We will need to lay out a roadmap for further equity raisings in what is now Europe’s fastest-growing super-budget hotel chain to make it the success it surely deserves to be.”
Sir Stelios had previously attempted to buy up shares to take his stake to just below the 30% threshold at which takeover rules would require him to make a bid for the whole company.
The 95p per share offer valued EasyHotel’s equity at £138.7m on a fully diluted basis and implied a multiple of 36.7 times the growing company’s Ebitda of £3.4m for the 12 months ended 31 March 2019.
The pair said that the company needed “significant investment” to fulfil its potential, with a move towards more franchising within the UK widely expected.
EasyHotel’s 12 owned hotels comprised 1,340 rooms, and it had a further 26 franchised hotels with 2,293 rooms. EasyHotel’s committed development pipeline of owned and franchised hotels currently consists of nine owned hotels and eight franchised hotels.
Karim Habra, head of Europe, 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 Meijer, founding partners of ICAMAP, said: “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.”
Insight: Guy Parsons’ exit at the end of last year was a shock to many, given the hand he’d had in steering the brand towards growth after a lackadaisical start which saw guests paying for clean sheets and a far-from-rapid rollout. But new owners – or majority owners at least – so a new CEO.
Baccetta is the latest in a series of executives to come into the sector from that mythical place known as Elsewhere, where so few hotel CEOs originate. The budget segment has developed a taste for them, however, with Premier Inn having acquired Alison Brittain from – whisper it – retail banking in 2015.
The attraction for Whitbread at the time was Brittain’s experience on the high street rather than in hotels and almost five years later she has served longer than many a hotel CEO and, despite ongoing rumblings from activist shareholders, the brand remains intact and determined to grow in Europe, with Germany at the forefront.
But away from how Whitbread should use its Costa proceeds to pay for that and back to Europe and the new incumbent at easyHotel. The association with easyJet was always seen as key to easyHotel’s success, not least because the brand’s expansion overseas tended to link to the routes of the airline. Value for money joined the two in the mind of the consumer and in the mind of the owner, as easyHotel felt that it owned as much as it need to in the UK – onwards to franchising.
In mainland Europe there was still an appetite for ownership as it looked to key locations and here the new CEO will be eager for the new owners to come good on their plans to realise the group’s potential and dig deep. With budget competition in Europe growing – and OYO lurking – expect the first fundraising sooner rather than later.