Motel One has been valued at €4.1bn (£3.5bn) after a 35 per cent stake was sold to its majority shareholder.
Real estate private equity firm Proprium Capital Partners has sold the shares to One Hotels & Resorts after first investing in Motel One 17 years ago.
One Hotels & Resorts is led by founder Dieter Müller and has snapped up Proprium’s stake for €1.25bn (£1bn).
Proprium acquired the stake as part of a €65m (£55.6m) investment in 2007 – the hotel chain’s last capital increase.
Motel One currently operates 94 hotels with 26,470 rooms and is aiming to grow to 117 properties with more than 32,000 rooms in 56 cities.
Philipp Westermann, partner and head of Europe of Proprium, said: “We are proud to have been a long-term partner to Dieter Müller and the Motel One team on its impressive growth journey for more than 15 years.
“Motel One has delivered outstanding profitable growth since inception by combining a unique design-led hotel concept, a disciplined and cash generative business model and an entrepreneurial culture.
“While the sale of our stake in Motel One will generate very attractive returns for our investors, we leave Motel One very well positioned with an enormous potential for future growth.
“The investment in Motel One exemplifies Proprium’s commitment to platform investing, aimed at delivering outsized private equity returns within the real estate industry.”
Dieter Müller, founder of Motel One and chairman of the supervisory board, added: “Together with Proprium, we have built Motel One into an international platform and brand and expect continued strong and profitable growth in the future.
“We thank the Proprium team led by Philipp Westermann for their trust and contribution.”
Morgan Stanley acted as financial advisor. Hengeler Mueller and Freshfields acted as legal advisors to OHR and Proprium respectively.