Economy

Historic Mamounia Hotel Changes Hands: A $173 Million Deal

Thursday 18 July 2024 - 10:00

In a landmark transaction, the Moroccan government has sold its shares in the legendary Mamounia Hotel to the state-owned OCP Group for a sum of 1.7 billion dirhams ($173 million). This move signals a significant shift in ownership for Morocco's oldest and most illustrious hotel, celebrated globally for its opulent Moroccan architecture and storied past.

The Mamounia Hotel, a jewel of Marrakech, marked its centenary last year. Over the decades, its majestic halls and gardens have hosted myriad notable figures, including Winston Churchill, Franklin D. Roosevelt, Charles de Gaulle, and Charlie Chaplin. The hotel’s timeless appeal and rich history have cemented its status as a cultural and architectural icon.

By the conclusion of 2023, the ownership landscape of the Mamounia Hotel involved a mix of corporate and governmental stakeholders. The OCP Group, which already held a 40% share, has now acquired a controlling interest. Meanwhile, the National Railway Office, the original builder and former majority stakeholder, now retains a stake of less than 10%.

Financially, the Mamounia Hotel has demonstrated robust performance, reporting a net profit of MAD 226 million ($23 million) last year, which marked a 10% increase from the previous year. The hotel features 135 rooms and 71 suites, each meticulously designed to reflect traditional Moroccan aesthetics.

This sale is part of a broader initiative by the Moroccan government to divest from non-strategic assets. This initiative includes stakes in various enterprises such as Marsa Maroc, where the state holds 25%, Maroc Telecom at 22%, the electricity company Taharouat, a biological and veterinary pharmaceutical production company, and the national seed marketing company.

Despite initial concerns from Moroccan lawmakers about the cultural significance of the Mamounia Hotel, Minister of Economy and Finance Nadia Fettah Alaoui has assured that all assets earmarked for sale will remain under Moroccan ownership. This reassurance aims to preserve the national heritage while achieving financial objectives.

The government’s divestment strategy aims to raise MAD 5 billion ($509 million) by 2024, a target that has been met following the recent Mamounia Hotel transaction. The last major divestment saw the sale of a stake in the Mazagan new city development company for MAD 1.6 billion to the OCP Group in December 2023, making it the sole owner of the project.

Looking ahead, the Moroccan government projects to generate an additional MAD 6 billion from its broader divestment program over the years 2025 and 2026. This strategic maneuvering underscores the government's commitment to optimizing its portfolio while ensuring continued Moroccan stewardship of historically significant assets.