SECURITIES
AND EXCHANGE COMMISSION
Washington
DC 20549
FORM 6-K
REPORT
OF FOREIGN PRIVATE ISSUER PURSUANT TO RULE 13a-16 AND 15d-16
OF
THE
SECURITIES EXCHANGE ACT OF 1934
For 18 February 2025
InterContinental Hotels Group PLC
(Registrant's
name)
1
Windsor Dials, Arthur Road, Windsor, SL4 1RS, United
Kingdom
(Address
of principal executive offices)
Indicate
by check mark whether the registrant files or will file annual
reports under cover Form 20-F or Form 40-F.
Form
20-F
Form 40-F
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EXHIBIT
INDEX
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99.1
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IHG
Hotels & Resorts acquires Ruby dated 18 February
2025
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Exhibit
No: 99.1
18 February 2025
IHG Hotels & Resorts acquires
Ruby, its 20th brand,
and targets global expansion
InterContinental Hotels Group PLC (IHG) has acquired from Ruby SARL
the RubyTM brand
and related intellectual property for initial purchase
consideration of €110.5m (~$116m1).
Ruby is a premium urban lifestyle brand for modern travellers in
must-visit city destinations and provides hotel owners with
space-efficient designs and an attractive, flexible concept that
IHG expects to rapidly expand globally.
Established in 2013, the Ruby brand currently operates 20 hotels
(3,483 rooms) in major cities across Europe and has another 10
pipeline hotels (2,235 rooms). There are 9 hotels open in Germany
(across Cologne, Dusseldorf, Frankfurt, Hamburg, Munich and
Stuttgart), 3 in the UK in London, 3 in Austria (Vienna), 2 in
Switzerland (Geneva and Zurich), and 1 in each of Italy, Ireland
and the Netherlands. The pipeline hotels are set to open over the
next three years across more European cities including Edinburgh,
Marseille, Rome and Stockholm.
Ruby hotels offer a stylish yet relaxed charm, blending soulful
design and authentic stories rooted in the cities they call home.
The brand's 'Lean Luxury' approach includes signature touches
ranging from a great bed and shower in guest rooms created with
restoration and relaxation in mind, to unique cocktails in
destination 24/7 bars, all coming together to connect guests with
sought-after cities at the right price.
As our 20th brand,
Ruby will extend IHG's appeal to modern, lifestyle-focused
travellers, and offers hotel owners a cost-efficient and highly
adaptable premium hotel concept, in an industry segment
characterised by high barriers to entry and space constraints,
often referred to in the industry as 'urban micro'. Efficiencies
for owners are delivered through space-saving designs and a high
degree of operational standardisation and automation, including
self-service kiosks for speedy check-in.
Ruby is already well-established in Europe and has proven to be
successful for both new build locations as well as being highly
conversion-friendly, including for adaptive re-use across a range
of commercial property types, with several successful office
conversions. Reflecting this, the Ruby brand has achieved a net
system size compound annual growth rate (CAGR) of 26% over the last
five years. The seller of the brand anticipates growing their
portfolio of Ruby-branded hotels substantially further, and IHG
expects to grow the brand with other hotel owners in Europe and
globally. This builds upon IHG's proven track record of
successfully internationalising brands that it has organically
developed and acquired. IHG expects to have the Ruby brand ready
for development in the US by the end of the year.
Joining forces with IHG allows Ruby hotels to draw on a powerful
enterprise platform of distribution and technology
systems, as well as one of the world's biggest and most powerful
hotel loyalty programmes, IHG One Rewards. IHG expects the urban
micro sub-segment to continue experiencing strong demand from
travellers around the world, and this in turn would support ongoing
rooms supply growth at higher rates than the global hotel industry.
IHG is targeting the Ruby brand to grow to more than 120 hotels
over the next 10 years and accelerate to more than 250 over 20
years across owners globally.
Elie Maalouf, Chief Executive Officer, IHG Hotels & Resorts,
said:
"We are delighted with the acquisition of Ruby, which further
enriches our portfolio with an exciting, distinct and high-quality
offer for both guests and owners in popular city destinations. This
acquisition demonstrates our focus on building our presence in
large, attractive industry segments and using our experience of
integrating and growing brands and hotel portfolios. The urban
micro space is a franchise-friendly model with attractive owner
economics, and we see excellent opportunities to not only expand
Ruby's strong European base but also rapidly take this exciting
brand to the Americas and across Asia, as we have successfully done
with previous brand acquisitions."
Michael Struck, Founder and CEO of The Ruby Group,
added:
"We have carefully selected IHG as the right partner to take the
Ruby brand and our international expansion to the next level. IHG's
distribution powerhouse, the fact that Ruby perfectly complements
IHG's portfolio, and its proven track record of successfully
preserving identity and culture when integrating brands gives us
great confidence as we embark on this next chapter together.
Combining the global reach and resources of IHG with the efficiency
advantages of our operational and construction model will drive
superior returns for our investors and real-estate partners, alike.
Also, the timing could not be better. Our unique solutions for
efficient adaptive re-use of office space are in high demand,
positioning us for strong growth."
Further details on the acquisition agreement and financial
overview:
● Initial purchase consideration of €110.5m
(~$116m1)
for IHG to acquire the Ruby brand and related intellectual property
consists of an upfront payment of €109.9m that has been paid
on completion of the transaction and a fixed deferred payment of
€0.6m payable upon approximately half the hotels joining
IHG's system.
● As part of the master franchise and development
agreement with Ruby, initial franchise fees receivable by IHG from
the current 20 open hotels and the current pipeline of 10 hotels
(which are all expected to open by the end of 2027) are anticipated
to be approximately $8m in 2028, which would be the first full year
when all 30 hotels would be in IHG's
system.
● Taking into consideration further development by
the seller to open more hotels beyond their current pipeline,
together with IHG's plans to expand the Ruby brand with other hotel
owners globally, franchise fees by 2030 are anticipated to be in
excess of $15m.
● The seller's operating company is not being
acquired by IHG and will continue to operate the current open
hotels and any future hotels that the seller develops under the
brand.
● Open, pipeline and all future Ruby hotels operated
by the seller will enter into individual franchise agreements with
IHG and pay to IHG brand royalty fees and System Fund
fees.
● To incentivise further growth in the brand by the
seller, potential additional payments ranging from €nil up to
€181m ($190m1)
may become payable in 2030 and 2035. Future payments are contingent
on the number of Ruby-branded rooms operated by the seller at the
end of the preceding year. A payment of €9m
($9m1)
would be paid to the seller if they grew to operate in excess of
10,000 Ruby-branded rooms. This scales up to the maximum potential
total if they grew to in excess of 20,000 rooms, a scale that is
approximately six times bigger than the current open hotels. IHG's
planned growth of the brand with other hotel owners is excluded
from the calculation of any potential additional payment to the
seller.
● The integration of all 20 currently open Ruby
hotels into IHG's system is expected to commence later in 2025 and
be completed by 31 March 2026. This would increase IHG's global
system size by approximately 0.3%. The current pipeline of 10
hotels when open would add a further ~0.2% to IHG's
system.
● Integration operating costs for IHG of
approximately $10m are expected to be incurred in 2025. Including
further one-time costs, in 2026 a broadly breakeven contribution to
IHG's operating profit is anticipated, with growth in profitability
forecasted thereafter.
Notes:
1 Converted
at an exchange rate of €1:$1.05, using the approximate rate
as at 14 February 2025
------ ends ------
About IHG Hotels & Resorts:
IHG Hotels & Resorts (tickers:
LON:IHG for Ordinary Shares; NYSE:IHG for ADRs) is a global
hospitality company, with a purpose to provide True Hospitality for
Good.
With a family of 19 hotel brands and IHG
One Rewards, one of the world's
largest hotel loyalty programmes, IHG has over 6,600 open hotels in
more than 100 countries, and a development pipeline of over 2,200
properties.
-
Luxury & Lifestyle: Six
Senses Hotels Resorts Spas, Regent
Hotels & Resorts, InterContinental
Hotels & Resorts, Vignette
Collection, Kimpton
Hotels & Restaurants, Hotel
Indigo
-
Premium: voco
hotels, HUALUXE
Hotels & Resorts, Crowne
Plaza Hotels & Resorts, EVEN
Hotels
-
Essentials: Holiday
Inn Express, Holiday
Inn Hotels & Resorts, Garner
hotels, avid
hotels
- Suites: Atwell
Suites, Staybridge
Suites, Holiday
Inn Club Vacations, Candlewood
Suites
- Exclusive
Partners: Iberostar
Beachfront Resorts
InterContinental Hotels Group PLC is the Group's holding company
and is incorporated and registered in England and Wales.
Approximately 385,000 people work across IHG's hotels and corporate
offices globally.
Visit us online for more about our hotels
and reservations and IHG
One Rewards. To download the
IHG One Rewards app, visit the Apple
App or Google
Play stores.
For our latest news, visit our Newsroom and
follow us on LinkedIn.
Cautionary note regarding forward-looking statements:
This announcement contains certain forward-looking statements as
defined under United States law (Section 21E of the Securities
Exchange Act of 1934) and otherwise. These forward-looking
statements can be identified by the fact that they do not relate
only to historical or current facts. Forward-looking statements
often use words such as 'anticipate', 'target', 'expect',
'estimate', 'intend', 'plan', 'goal', 'believe' or other words of
similar meaning. These statements are based on assumptions and
assessments made by InterContinental Hotels Group PLC's management
in light of their experience and their perception of historical
trends, current conditions, expected future developments and other
factors they believe to be appropriate. By their nature,
forward-looking statements are inherently predictive, speculative
and involve risk and uncertainty. There are a number of factors
that could cause actual results and developments to differ
materially from those expressed in or implied by, such
forward-looking statements. The main factors that could affect the
business and the financial results are described in the 'Risk
Factors' section in the current InterContinental Hotels Group PLC's
Annual report and Form 20-F filed with the United States Securities
and Exchange Commission.
About The Ruby Group
The Ruby Group under the leadership of founder and CEO Michael
Struck is breaking new ground with its Lean Luxury philosophy. With
a lean organisational structure and concentration on the
essentials, Ruby succeeds in creating a contemporary, accessible
form of luxury for modern, cost and style-conscious customers.
Founded in 2013, the group operates 20 Ruby hotels across Europe,
with an additional 10 hotels currently under construction or in the
planning phase. Ruby also offers Ruby Workspaces - perfectly
equipped workplaces and a creative atmosphere with access to an
inspiring office community. Financially strong shareholders support
Ruby's expansion: ECE Group; the Austrian Soravia Group; Franger
Investment, a German family office; Ocean Redstone, a private
equity fund; the entrepreneur Michael Hehn; and Michael Struck
jointly hold the company shares.
SIGNATURES
Pursuant
to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf
by the undersigned, thereunto duly authorized.
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InterContinental Hotels Group PLC
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(Registrant)
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By:
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/s/ C.
Lindsay
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Name:
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C.
LINDSAY
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Title:
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SENIOR
ASSISTANT COMPANY SECRETARY
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Date:
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18 February 2025
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