Carlson eyes doubling TGI Friday's chain
BERLIN (Reuters) - Hotel, restaurant and travel group Carlson is investing heavily in its U.S. hotels and believes it could double the size of the TGI Friday's restaurant chain now the hospitality industry is recovering, its CEO said.
"We only have 600 restaurants in the U.S. and could go to 800-1,000 there," Hubert Joly told Reuters in an interview on the sidelines of a hotel conference in Berlin on Tuesday.
Minnesota-based Carlson currently operates more than 900 TGI Friday's restaurants in 60 countries. The casual dining sector was not as heavily impacted by the global recession as the travel industry, Joly said.
"Ultimately, internationally, this is a portfolio that could double in size," Joly said, adding that the group would focus on adding restaurants in key markets such as China and Britain.
Carlson also owns just over 50 percent of Rezidor Hotel Group (REZT.ST), whose brands include Radisson and Park Inn, competing with Starwood (HOT.N) and Marriott MAR.N.
France-born Joly said the group planned to spend between $1 billion and $1.5 billion on renovating Radisson hotels in the United States, with around $500 million of that already committed.
"As we went through the crisis, we conserved cash and now it's the year where we're going to unleash it," he said.
Joly said unlisted Carlson had no need to turn to the markets for funding after building up a cash pile from disposals of non-core operations a couple of years ago.
"For the moment, the family's preference is to stay private at the core," he said.
Joly said the group had seen little impact from the unrest in North Africa, as it has only six hotels in Egypt, one in Libya and three in Tunisia out of a total 1,070 worldwide.
Joly also played down the resultant higher oil prices, saying there was a sense it was temporary.
Rising commodity costs mean companies in a range of industries, from retailers to chemicals firms and consumer goods, are looking to increase prices.
Joly said the group would only have to increase restaurant prices if input cost pressure remained significant, although hotel prices would rise anyway after discounting during the recession.
"As occupancy rates recover we can claim some price back as prices have gone down significantly."
(Editing by David Cowell)