Motel One prepares for IPO as founder retakes control

London private equity group Proprium Capital Partners has offloaded its shareholding in Motel One back to the German low-cost hotel chain’s founder in a deal worth €1.25bn.

The transaction, which values Motel One at €4.1bn, saw founder Dieter Müller’s One Hotels and Resorts buy a 35% stake in the company, giving it sole ownership.

The move is said to be part of Mueller’s plans to list Motel One on the stock market.

Motel One, based in Munich, runs 92 hotels with 25,817 rooms across 11 countries across Europe, as well as the UK and USA – with plans to open seven more.

Müller, who sits on the supervisory board as chair, said in a statement: “The buyout and the spin-off of the properties are important steps for Motel One in preparation for the planned IPO in the medium term."

Proprium invested just €65m in Motel One back in 2007 as part of as the latter’s capital increase.

Proprium’s head of Europe, Philipp Westermann, said in a statement: “While the sale of our stake in Motel One will generate very attractive returns for our investors, we leave Motel One very well-positioned with an enormous potential for future growth. The investment in Motel One exemplifies Proprium’s commitment to platform investing, aimed at delivering outsized private equity returns within the real estate industry.