Warburg Pincus, through its affiliate Coastal Cedar Investments BV, will also commit to invest up to ₹960 crore of primary capital in Fleur to support future growth.
Fleur Hotels is currently a subsidiary of Lemon Tree Hotels. Post the transaction and completion of regulatory approvals, Fleur will be listed as a separate entity on Indian stock exchanges.
The listing process is expected to be completed within 12 to 15 months.
As part of the reorganisation, Lemon Tree Hotels will transition into a pure-play, asset-light hotel management and brand platform, while Fleur Hotels will become the group’s hotel ownership and development company.All existing hotel assets owned by Lemon Tree will be transferred to Fleur, which will also lead future hotel acquisitions and development.
Under the proposed shareholding structure, shareholders of Lemon Tree Hotels, as on the record date, will directly own 32.96% of Fleur Hotels. Lemon Tree will hold a 41.03% stake, while Warburg Pincus will own the remaining 26.01%.
These figures exclude any dilution arising from the primary capital infusion by Warburg Pincus.
The scheme provides for the merger of Lemon Tree’s wholly owned subsidiaries Carnation Hotels and Hamstede Living with the parent company. Four other wholly owned subsidiaries—Oriole Dr Fresh, Sukhsagar Complexes, Manakin Resorts and Canary Hotels—will be merged with Fleur Hotels against the issuance of Fleur shares to Lemon Tree.
Twelve hotels, including 11 operational properties and one under-construction hotel in Shimla, along with development capabilities and an investment in a hotel under construction in Shillong, will be demerged into Fleur. All hotels under Fleur will operate under a new hotel operating agreement with Lemon Tree, effective April 1, 2026.
Following the reorganisation, Fleur’s owned portfolio will expand from 24 operating hotels with 3,993 keys to 41 hotels with 5,813 keys. Lemon Tree will continue to operate and manage these hotels under its asset-light model, while also managing and franchising its third-party owned portfolio in India and overseas.
This transaction marks the second strategic partnership between Lemon Tree Hotels and Warburg Pincus. Morgan Stanley acted as the exclusive financial advisor to the transaction.
The composite scheme is subject to approvals from shareholders, regulators and the National Company Law Tribunal.
