Saudi Arabia’s sovereign wealth fund has agreed to buy a 49 per cent stake in Rocco Forte Hotels in a deal that is believed to value the luxury group’s properties at about £1.2 billion ($1.52 billion).
The Public Investment Fund is snapping up the “significant” minority stake in the company, which owns The Balmoral in Edinburgh and Brown’s Hotel in London, with an aim of helping it to expand further worldwide.
Rocco Forte Hotels, which was founded in 1996, has 14 hotels and resorts, as well as 20 private villas across Italy, the UK, Germany, Belgium and Russia.
The group plans to open three hotels in 2024 and 2025.
Founders Sir Rocco and his sister Olga Polizzi keep a 51 per cent stake in the company and remain as executive chairman and deputy chair respectively.
However, Italian sovereign wealth fund CDP Equity will sell its entire 23 per cent shareholding as part of the deal.
It is believed that four of Sir Rocco's five sisters will also exit the firm.
The deal marks the latest swoop by Saudi Arabia's sovereign wealth fund to invest in UK assets.
Saudi's PIF also recently agreed to buy a 10 per cent stake in Heathrow Airport.
The Rocco Forte stake purchase adds to its existing interests in luxury hospitality, having already bought minority stakes in hotel groups Aman Resorts and Habitas last year.
Sir Rocco said the PIF was an “excellent partner” for the group.
“We have established an extremely good relationship during the course of our negotiations,” he said.
“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.”
The PIF, which has invested in other transport sites, technology businesses and sports teams such as Newcastle United FC, has more than $700 billion (£552 billion) in assets.
Turqi Al Nowaiser, deputy governor and head of the international investments division at PIF, said: “Our investment in Rocco Forte Hotels reflects PIF's confidence in both the commercial opportunity and strength of the international hospitality and tourism industries that have shown remarkable resilience in recent years.”
