* Board terminates mandate of Accor Chairman/CEO Hennequin
* Board names transition executive team, with Caillere CEO
* Citerne named non-executive Chairman, Bazin Vice-Chairman
* Activist shareholders have been pushing for change
* Accor shares close down 2.1 pct before board meeting ends
By Dominique Vidalon and Cyril Altmeyer
PARIS, April 23 Accor SA ousted
Chairman and Chief Executive Denis Hennequin on Tuesday and put
a transition team in charge of Europe's largest hotel group amid
a disagreement over the pace of change.
The French company named Chief Operating Officer Yann
Caillere CEO, while board member Sebastien Bazin, the head of
Colony Europe, was named vice-chairman to replace Philippe
Citerne, who becomes non-executive chairman.
Hennequin is the third chief executive to be ousted from
Accor, the world's fourth-largest hotelier, since U.S. investor
Colony Capital invested in the group in 2005.
Private equity firm Eurazeo SA joined Colony at
Accor in 2008 and together they own a combined 21.4 percent of
the capital and command four board seats.
Sources have said the stakeholders were losing patience with
the weak performance of Accor shares, down nearly 5 percent this
year, and wanted to speed up asset sales and franchising to
boost returns for investors.
Hennequin was hired in 2010 to accelerate an "asset-light"
strategy of reducing Accor's exposure to capital intensive owned
hotels in favour of franchises and management contracts.
During his tenure, he sold loss-making U.S. budget hotel
Motel 6 for $1.9 billion and turned Accor, whose brands range
from the luxury Sofitel chain to budget-oriented Ibis, into a
pure hotel player, selling gourmet caterer Lenotre and a stake
in casino group Lucien Barriere.
In February, Hennequin launched a three-year plan to reduce
Accor's exposure to a weak Europe, stepping up expansion in
emerging markets and cutting costs, while accelerating its move
toward franchising or managing hotels for others to boost profit
Accor, which makes more than 70 percent of its sales in
Europe, said the plan would boost its operating margin to above
15 percent by 2016 against 9.3 percent last year.
Nevertheless, Accor, which competes with global rivals
InterContinental Hotels Group Plc, Marriott
International Inc or Starwood Hotles and Resorts
Worldwide, said on Tuesday the change must be
accelerated in the face of tough economic conditions, notably in
"The directors came to the joint conclusion regarding the
group's situation: that the strategy adopted is the right one
and that it will remain unchanged," Accor said in a statement.
"However, given current economic conditions and the rapid
transformation of its competitive environment, Accor must
accelerate the implementation of this strategy in order to
reinforce its positions."
Accor said Hennequin had reservations about giving top
priority to transforming Accor's business model and so the board
unanimously voted to terminate his mandate with immediate
effect. Hennequin also resisted pressure to split property
holdings from the hotel business.
Colony and Eurazeo declined to comment following the
announcement on Tuesday.
Hennequin's exit is likely to draw attention again to the
role played by the activist shareholders.
The former CEO of McDonald's Europe took the top job at
Accor after his predecessor, Gilles Pelisson, was ousted in 2010
over "strategic differences" with the board.
Accor's market capitalisation of 5.9 billion euros ($7.7
billion) is little more than that of its former subsidiary
Edenred SA, which was spun off in 2010. The meal
vouchers company is valued at 5.6 billion euros.
Accor is scheduled to hold its annual shareholders meeting,
which will be chaired by Citerne, on Thursday.