H Hotel and Huazhu’s Elan Hotel have merged in China, according to an announcement by the Huazhu Group on March 9.
H Hotel, OYO’s rival budget hotel chain in China, joined forces with Huazhu’s economy hotel brand Elan. At the same time, the shanghai-based company Huazhu still holds a minority stake in OYO, which was bought back in 2017 with a USD 10 million equity investment.
After a series of A funding led by the Huazhu Group and IDG in 2019, H Hotels grew up to 2,500 small franchised hotels in Chinese cities. Elan Hotel’s portfolio encounters 600 hotels on the other hand.
The future of the two companies is unclear for the moment, whether they will have strategic or operational synergies, or not. The market they bother target is huge, as only 22% of the Chinese Hotel supply work with hotel chain brands for now, the rest being independent hotels.
This comes as an echo to Vanguélis Panayotis’ Editorial, referring to the various mergers in the hospitality sector for the past five years, especially in luxury market with Marriott and Starwood that “got the ball rolling and launched the wedding season”.