Warburg Pincus Invests in Lemon Tree’s Asset Arm as Hotel Group Splits in Two
Photo Credit: Aurika Udaipur, a luxury property by Lemon Tree Hotels. Lemon Tree Hotels
Skift Take
Lemon Tree on Thursday denied Warburg buying into Lemon Tree, which was technically true. Two days later, it confirmed Warburg is indeed stepping into the group, just through a different door.
Private equity firm Warburg Pincus will acquire Dutch asset manager APG’s entire 41.09% stake in Fleur Hotels, the asset-owning arm of India’s Lemon Tree Hotels, as part of a wider restructuring of the group.
Warburg Pincus will also invest up to INR 9.6 billion ($106 million) of fresh equity into Fleur in stages to fund future growth.
The transaction is part of a broader plan that will split Lemon Tree into two separate businesses: one that owns hotel real estate, which will be Fleur, and another that runs hotels, brands, and customer-facing operations – that’s Lemon Tree Hotels.
A Two-Company StructureUnder the plan, Fleur Hotels will become the group’s hotel owner and developer. Lemon Tree Hotels will shift to a fully “asset-light” model, focusing on hotel management, branding, franchising, and digital distribution.
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