Saudi Arabia's sovereign wealth fund, the Public Investment Fund (PIF), is set to acquire a substantial 49% stake in the esteemed luxury hotel group, Rocco Forte Hotels, according to an announcement made on Monday. The deal, which values the hotel group at approximately £1.4 billion ($1.8 billion), reflects PIF's strategic diversification efforts under the Vision 2030 plan, aimed at reducing the country's reliance on oil revenue.
Rocco Forte Hotels, known for its iconic properties such as Britain's Balmoral hotel, will see the founders, Rocco Forte, and his sister Olga Polizzi, retain their positions as executive chairman and deputy chair, respectively. The Forte family will maintain majority ownership and control of the group, which currently boasts 14 hotels across Italy, Britain, Germany, Belgium, and Russia. With an additional 20 private villas augmenting its portfolio, the hotel group is set to open three more hotels in Italy over the next two years—two in Milan and one in Sardinia.
The PIF's investment is seen as a crucial step in supporting Rocco Forte Hotels' expansion plans. "PIF is an excellent partner for us going forward. They share the same vision for the brand and the future strategy of the group with the same ambition to take a long-term view," commented Chairman Rocco Forte, 78, in a statement, emphasizing the alignment of objectives between the hotel group and its new strategic partner.
While the financial terms, including the exact size of PIF's stake, remain undisclosed, reports suggest that the deal was structured to provide an enterprise value of £1.4 billion. CDPE Investimenti, an Italian investor and a subsidiary of Italy's state-backed fund CDP, will divest its entire 23% shareholding as part of the agreement. CDPE had initially invested 80 million euros in Rocco Forte Hotels in 2015.
The move underscores Saudi Arabia's commitment to diversifying its investment portfolio beyond traditional sectors, embracing the thriving international hospitality and tourism industries. Turqi Al Nowaiser, representing PIF, expressed confidence in the commercial opportunity presented by Rocco Forte Hotels and highlighted the strength of the global hospitality sector.
Rocco Forte Hotels, advised by Rothschild in the transaction, reported revenues of around £300 million in the last fiscal year, with a core profit of approximately £60 million. The acquisition by PIF signals a new chapter in the hotel group's storied history, as it aligns with Saudi Arabia's broader economic vision, adding a prestigious asset to the country's diversified investment portfolio.
