China’s Huazhu Group HTHT.O, the world’s fifth largest hotel group by market capitalization, is buying the Steigenberger hotels for USD 781 million in cash for Steigenberger parent Deutsche Hospitality. Huazhu is buying Deutsche Hospitality from Egyptian tourism entrepreneur Hamed El Chiaty’s Travco Travel. He had bought the group from the Steigenberger family in 2009. El Chiaty will stay invested in a Middle-East joint venture.

The company is seeking to extend its global reach with the addition of one of Germany’s most well-known upmarket chains, as per Nasdaq.

Huazhu, based in China and listed in New York, operates hotels using a franchise model and on leased properties. It opens 1,000 hotels each year. The acquisition will add to its more than 5,000 hotels.Deutsche Hospitality operates 118 hotels and has 36 hotels under development, with a focus on Europe. It has plans to increase that number to 250 by 2024.

That values Deutsche Hospitality, whose brands include MAXX by Steigenberger, Jaz in the City, IntercityHotels and Zleep at 17-18 times its 2019 expected earnings before interest, tax, depreciation and amortization or at less than 10 times expected 2022 core earnings.

Peers such as Marriott, Hilton, Accor, InterContinental and Hyatt trade at 11-14 times their expected core earnings over the next twelve months, while China International Travel 601888.SS and smaller peer Huazhu both trade at more than 20 times.