A historic moment for the paddled company

December 31, 2011 12:00 AM
A historic moment for the paddled company

Without wanting to prejudge here the ultimate decision of its Board of Directors, expected in February, one cannot but note that Accor has never been as close to a split between its two major trades, catering and services (Ticket Restaurant...). A historic moment for the paddled company. Everything for the launch of a study on "relevance" of separation, its CEO, Gilles Pélisson, failed to note that part of the Council was already satisfied. He also pleaded for the creation of a second rated entity. This strategic shift at 180 deserves to be pointed out and more than one title. Beyond the conversion of its CEO, who however repeatedly assured that the Accor Services subject "is not taboo", the "split", desired of long date by the market, marks the end of a model. And perhaps a bold break.

Without real synergies, Accor and two crafts have for them a tremendous complementarity: less sensitive to economic cycles, little gourmet capital, strong cash flow generator and highly profitable, Accor Services has been and remains a same brother for a less profitable hotels and capital-intensive density. Conversely, the latter was useful as a gateway in many countries. It also may be recalled that Gilles Pélisson stated in our columns a little more than a year ago ("Les Echos" from September 1, 2008), while he was questioned about the fate of the activity: "surrender is excluded, and the potential is large." However, my view that an award of a majority of the capital could weaken the Accor Group, as Accor Services represents 40 of its results. "This weight argument, we can add another: pole services accounting for 40 of its outcome in Latin America, its dependence on the evolution of exchange rates is not to be overlooked. Then, that what is today justifies a radical rupture

The CEO of Accor argue today, not without reason, that the services pole, "doped" by a strong external growth since 2006, has any other dimension, especially since the partnership, established in February, with MasterCard Europe. Objective of the common PrePay Solutions (67 Accor) subsidiary: acquire a share of 5 by 2015 in the European market of cards and prepaid services weighing EUR 132 billion. Built from the Ticket Restaurant, Accor Services has not only significantly expanded its offer but now would need to take his freedom to forge other alliances and confront a new competition, one of the players in the finance. At the presentation of the French-American, "" totally strategic marriage, he had however reaffirmed that Accor "march was best on two legs"...

In addition to the failure of an economic model, there is also the question of the fate of the two activities. Deprived of the cash flow of the services, Accor Hospitality will have to start producing more fuel. However, a significant profile development is announced: in the future, of Accor hotels will be even more focused on economics and the means of range, Europe and the famous BRICs, with an accuracy of size about China, where the expansion of Ibis program is divided by two. This reframing already revived imputations on the sale of Sofitel, repositioned on the luxury segment, but the North American superéconomique chain Motel 6.

In addition, the hotel operator will be more franchisor, and will proceed with new assignments of walls. Not to mention recent non-strategic assets, including the 49 of group Lucien Barrière. Air, our French champion aligns the anglo-saxon Hotel model of brand manager. Some observers point out also, rightly, that if the service pole, valued around 5 to 5.5 billion euros, had sold instead of side separately, it would have given a considerable strength to the group in the hotel. The key to distribution of the debt (1.96 billion euros in net debt at June 30) and financial availability of Accor (1.8 billion lines of credit) non-consumed between the two entities that it plans to create will be crucial for the future of the hotel. Services, said, however, would be in capacity to withstand many debts.

But the choice of the split, which will also result in an arbitration on the Accor brand, returns to another substantive subject: enhancement of the group. Because shareholders logic underlying the new operational problem. Particularly fortunate since 2006, with roughly a "return" of EUR 3.5 billion about various forms (excluding ordinary dividend for 2005), they should find their account in the short term. With, on the one hand, a little capitalistic hotel activity and continuing its disposals of assets and, on the other, a second marketable participation, this "split" looks like a great case for the shareholder of reference, the Colony Capital-Eurazeo duo.