Why Did Rocco Forte Partner With Saudi Arabia’s PIF?

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Transcript

00:00You agreed a deal in December 2023 to sell 49% of your family's hotel chain to Saudi Arabia's Sovereign Wealth Fund.

00:08What was the rationale for that deal with the PIF?

00:12Well, I decided because I had members of my family who had interest.

00:18When I first started the business in 1997, my father invested a bit of money.

00:26When my parents died, my sisters, I have five sisters, one Olga who works with me, the others didn't.

00:34They all inherited shares in the business and they had no involvement in the business.

00:40So they kept complaining about this.

00:44And so I thought I should find a way of taking them out.

00:50And so I'd seen there's some transactions in the market which were quite attractive.

00:55So I said to Rothschilds, who are my bank, let's see if there's anybody interested.

01:00And we sent out a teaser to about 20 companies.

01:05And PIF came back straight away and said, yes, we're interested.

01:08We're only interested if we can deal exclusively with you.

01:11We don't want to enter into an auction.

01:13So we sent them information.

01:16They made an offer which was attractive to us.

01:18And we went ahead and the negotiations took, I suppose, about six or seven months to come to completion.

01:26And so they invested, not only they bought my sister's shares, they invested money into the company as well,

01:36which significantly strengthened our balance sheet.

01:39And the money invested was really to enhance our growth capabilities.

01:48But we've also used it to catch up in our refurbishments programs, which were delayed by the COVID period.

01:56It was two years of basic survival for me.

01:58And they, of course, it raised our profile in the world, this deal.

02:09PIF are a long-term partner.

02:12They look long-term into future.

02:15We're a family business.

02:16And I have that same outlook.

02:19They're not a fund that comes in and out, you know, and wants to turn a profit in the meantime.

02:25And so they're the ideal partner for us.

02:29They're very good partners.

02:30Obviously, they've invested in a huge number of companies around the world, which we're one.

02:37And they're very supportive.

02:40And we work well together.

02:43Okay, so two years on, you'd say it's been a good arrangement.

02:47Yes, very good, yes.

02:48Okay.