Hanwha Hotels & Resorts Absorbs Hanwha Estate... "Development and Operation Synergy" (Comprehensive)

Hotel & Resort Accommodation Facility Development and Operation + Estate Real Estate Planning and Consulting Capabilities Combined
New Business Initiatives Including Content-Enhanced Hotels and Resorts, New Concept Leisure Residential Culture Development, and Entrusted Operation

[Asia Economy Reporter Kim Yuri] Hanwha Hotel & Resort announced on the 11th that it will absorb and merge Hanwha Estate. The merger ratio between Hanwha Hotel & Resort and Hanwha Estate is 1 to 0.1963881.

The major shareholders of Hanwha Hotel & Resort are Hanwha (50.62%) and Hanwha Solutions (48.70%). Hanwha Estate’s shareholder is Hanwha Construction (100%). For this absorption merger, Hanwha Hotel & Resort issued new shares which Hanwha Construction will acquire, becoming the third largest shareholder of the merged corporation. After the merger, the shareholding ratio is expected to change to Hanwha (49.78%), Hanwha Solutions (47.88%), and Hanwha Construction (1.67%).

Hanwha Hotel & Resort stated regarding this merger, "In the midst of rapid changes in the real estate and leisure industries, this merger between companies with expertise is a decision to expand business areas, increase management efficiency, and secure continuous growth engines to set a new business direction in the post-COVID-19 era."

The company added, "Through this merger, we plan not only to strengthen business competitiveness but also to create new customer value in the changing market."

In particular, the plan is to combine the accommodation facility development and operation capabilities, including assets owned by the existing Hotel & Resort, with Estate’s real estate planning and consulting, asset and facility operation management, and architecture and energy capabilities to secure market competitiveness. They are also exploring expansion of new businesses through improved financial conditions and credit ratings.

As a core new business, they plan to introduce hotels and resorts enhanced with attractive content aiming to become the "best hospitality brand in Korea." They also intend to diversify their brand portfolio through new concept leisure residential culture development, entrusted operation, and facility management businesses.

This merger will be conducted with Hanwha Hotel & Resort as the surviving company absorbing Hanwha Estate, inheriting all statuses.

After the merger, Hanwha Hotel & Resort will operate with two business divisions (Hospitality, Real Estate Management and Architecture & Energy). To maintain the expertise of each company’s business area after the merger, they plan to keep separate CEO systems.

Hanwha Hotel & Resort and Hanwha Estate will proceed with merger procedures following the merger decision announcement, with the merger expected to take place in July (tentative).