Hyatt Hotels Corp. has reached a definitive agreement to acquire Apple Leisure Group (ALG) for $2.7 billion in cash in a deal that will double its resort footprint.
The transaction, which is expected to close in the fourth quarter, will add about 100 AMResorts properties to its portfolio. Many of those resorts are in Mexico and the Caribbean, operating under the Secrets, Dreams, Breathless, Zoetry and Sunscape brands.
AMResorts also has a large presence in Spain, Mallorca and the Canary Islands, primarily under the Alua brand. Hyatt said the acquisition will expand its European footprint by 60%.
The acquisition of AMResorts is an asset-light acquisition, as AMResrorts is a resort branding and management company that does not own the properties it operates.
The Hyatt acquisition includes all of ALG's other businesses, including its well-known brands in packaged travel: Apple Vacations, Travel Impressions, Funjet Vacations, CheapCaribbean, Southwest Vacations, United Vacations, BlueSkyTours Hawaii and BeachBound.
Hyatt also becomes the parent of technology company Trisept Solutions, ALG's Unlimited Vacation Club and Amstar, a provider of transportation and excursions in resort destinations.
At closing, Hyatt expects to fund more than 80% of the purchase with a combination of $1 billion in cash on hand and new debt financings, and the remainder with approximately $500 million from equity financing.
Hyatt made its debut into the all-inclusive arena in 2013 in a venture with Playa Hotels & Resorts to launch the Zilara and Ziva brands.