{The boss of the Radisson hotel chain said the company will press on with its emerging market expansion plans in the wake of November’s terrorist attack}
When the luxury hotel in Mali that had been attacked by Islamic militants in November re-opened last month, it was hailed as a triumph over terrorism.
Ibrahim Boubacar Keita, the president of the West African nation, declared it “a victory of life over the jihadists”. About 100 people congregated at the Radisson Blu in Bamako, Mali’s capital, for the re-opening ceremony.
There were defiant scenes, with employees celebrating the occasion by hoisting aloft Gary Ellis, the hotel’s manager. Staff were “resuming our activities with a winner’s spirit” he said.
It was in stark contrast to the situation less than four weeks earlier, when the 190-room property was the site of a bloody hostage-taking in which 22 people were killed, including three hotel employees and two terrorists. The attack took place on Friday, Nov 20, and by the Monday, Wolfgang Neumann, the chief executive of Rezidor, the operator of the Radisson chain, had flown into Bamako.
The Austrian will never forget the sight that confronted him when he visited the hotel the following day.
“When you see it on television it’s one thing, when you actually walk through a building and witness the damage it’s quite different,” he says. What Neumann, 53, saw was “a hotel which was unrecognisable to what you normally see when you walk into a hotel. It was a real crime scene”.
It was also a graphic reminder of the greater risks that multinationals face when operating in some parts of the developing world, markets that Stockholm-listed, Brussels-based Rezidor are hoping will power its growth.
Best known for its Radisson Blu and mid-market Park Inn brands, Rezidor, which is majority-owned by American hotels business Carlson, runs 351 hotels across Europe, the Middle East and Africa.
Like its larger rivals, the company is expanding rapidly in emerging markets, particularly Africa. Fast-growing and potentially lucrative, the developing world is becoming increasingly attractive to western hotel operators.
In July, France’s Accor agreed a partnership with an Angolan company to open 50 hotels in the country by next year, to counter waning growth in Europe. Marriott completed a deal to buy South African hotels business Protea for about $200m in 2014, an acquisition that transformed the American giant into Africa’s biggest hotel company.
For Neumann, who has led the business since 2013, the Mali attack is a blow because pushing into Africa and Russia is a big part of his turnaround plans.
While the third-quarter was the second-strongest in Rezidor’s history – with like for like revenue per available room up 8.7pc and total sales rising 8.6pc to €261.4m – the company still lagged behind its so-called Route 2015 revival plan, hurt by the impact in Norway of the oil industry downturn.
Route 2015 was launched because the “company has grown extremely fast, but from a financial performance angle we needed to improve the results,” Neumann says.
To help strengthen the business, he is growing the company aggressively in emerging markets. Rezidor has 106 hotels in development, 62 of which are in the Middle East and Africa.
Some of the cities that Rezidor has earmarked for expansion are in areas of the world where most tourists would balk at visiting, but where there is nevertheless growing demand for rooms from international business travellers.
In 2017, a 260-room Radisson Blu hotel is set to open in Erbil, the capital of Iraq’s oil and gas rich Kurdistan region, an area that was ravaged by fighting with Islamic State of Iraq and the Levant last year.
This year, Rezidor also plans to open a 126-room property in Misrata, its second in Libya, another strife-torn country that remains highly dangerous.
The hotelier’s first Libyan property, in Tripoli, has been forced to close twice since it was launched in 2009 and has only recently re-opened for the second time.
Furthermore, the siege in Bamako is not the first time one of Rezidor’s hotels that has been attacked. In 2005, a suicide bomber blew himself up in the Radisson SAS in Amman, Jordan, one of three hotels that were targeted in simultaneous co-ordinated strikes.
Neumann says the latest attack in Mali has not altered the company’s expansion plans, and that Africa in particular remains attractive to Rezidor. Indeed, the business boasts that its pipeline of hotels on the continent is bigger than that of any other hoteliers.
Source:Telegraph:[Radisson boss undeterred by Mali tragedy->http://www.telegraph.co.uk/finance/newsbysector/retailandconsumer/leisure/12077514/Radisson-boss-undeterred-by-Mali-tragedy.html]
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