Lemon Tree and Fleur unveil composite scheme to unlock long-term shareholder value

Lemon Tree Hotels Limited and Fleur Hotels Limited have announced that their respective Boards of Directors have approved a Composite Scheme of Arrangement aimed at simplifying the group structure, sharpening strategic focus, and unlocking long-term value for shareholders.

Strategic Reorganisation
- Companies involved: Lemon Tree Hotels Ltd. and its subsidiary Fleur Hotels Ltd.
- Objective: Simplify group structure, sharpen strategic focus, and unlock long-term shareholder value.
- Structure:
- Lemon Tree Hotels: Will become a pure-play, asset-light hotel management and brand platform (focused on franchising, management, and digital businesses).
- Fleur Hotels: Will evolve into a large-scale hotel ownership and development platform, spearheading acquisitions and new builds.

Investment & Partnerships
Warburg Pincus:
- Acquiring 41.09% stake in Fleur from APG Strategic Real Estate Pool N.V.
- Committing ₹960 crore primary investment in tranches to support Fleur’s growth.
APG Exit:
APG divests its long-term stake in Fleur, marking a full-cycle return.
Ownership Post-Scheme:
- Lemon Tree shareholders: 32.96% of Fleur
- Lemon Tree direct holding: 41.03%
- Warburg Pincus: 26.01% (before dilution from new investment).

Operational Impact
Fleur Hotels:
- Expands portfolio from 3,993 keys (24 hotels) → 5,813 keys (41 hotels).
- Will be listed separately on NSE & BSE within 12–15 months.

Lemon Tree Hotels:
- Retains management of leased hotels in Indore & Aurangabad.
- Manages 1,820 keys across 17 hotels transferred to Fleur.
- Continues asset-light expansion with 6,011 keys across 89 operational hotels and 9,414 keys across 127 hotels under development.

Leadership & Governance
- Patanjali Govind Keswani:
- Executive Chairman of Fleur Hotels.
- Transitioning to non-executive role at Lemon Tree.

✅ Bottom Line: The composite scheme creates two focused growth engines—Lemon Tree as an asset-light operator and Fleur as a major asset owner. With Warburg Pincus’ capital infusion and APG’s exit, the reorganisation positions both companies to capture India’s booming hospitality demand while enhancing shareholder value.