US-based private equity firm Warburg Pincus is set to invest Rs 9.6 billion to support the growth of Fleur Hotels, as part of a group reorganisation exercise announced by Lemon Tree Hotels, India’s third-largest hotel chain. As part of the transaction, Warburg Pincus will also acquire a 41.09 per cent stake in Fleur Hotels from Dutch pension fund APG. The company said the scheme, to be implemented through a process approved by the National Company Law Tribunal, will reorganise the group’s asset ownership and operating structure. Hotel assets currently owned by Lemon Tree will be transferred to Fleur, which will become the group’s exclusive asset ownership and development company. Fleur will lead all future hotel acquisitions and development, while Lemon Tree will transition into a fully asset-light model focused on expanding its hotel management, franchising and digital businesses. Fleur Hotels is also expected to be listed separately on the stock exchanges within the next 12 to 15 months. Patanjali Govind Keswani, founder and executive chairman of both Lemon Tree and Fleur Hotels, said the reorganisation is aimed at creating a simplified, transparent and growth-oriented structure that enhances long-term shareholder value. Keswani will serve as executive chairman of Fleur Hotels and will eventually move to a non-executive role at Lemon Tree. He said the partnership with Warburg Pincus comes at a critical inflection point for the Indian hospitality sector and will help scale operations responsibly, strengthen digital-led capabilities and embed sustainability as a core pillar of long-term growth. Following completion of the transaction, Fleur is expected to emerge as one of the largest owners of hospitality assets in India, with its owned portfolio expanding to 5,813 keys across 41 hotels, from the current 3,993 keys and 24 operating hotels. Lemon Tree will continue to operate its leased hotels in Indore and Aurangabad, which are nearing the end of their respective lease terms. In addition, Lemon Tree will manage an additional 1,820 keys across 17 hotels transferred to Fleur, alongside its existing portfolio of 3,993 keys and 24 Fleur-owned hotels already operated by the company. Anish Saraf, managing director at Warburg Pincus, said the firm was pleased to partner again with Keswani and the Fleur leadership team, adding that favourable industry fundamentals and a clear strategic roadmap position the platform well for its next phase of growth.