(Yicai Global) April 19 -- New Century Hotel Management, the Chinese owner of hospitality brands such as Grand New Century and Wonderland Resorts, will end its two-year journey and delist from the Hong Kong Stock Exchange due to the impacts of the Covid-19 pandemic.

Zheng Nanyan, co-founder of budget hotel chain 7 Days Group Holdings, will become the new director of the mid to high-end hotel chain, a person familiar with the matter told Yicai Global.

New Century Hotel's shareholders have accepted Kunpeng Asia's privatization offer, the Zhejiang province-based company said in a statement on April 14. The offer price is HKD18.15 (USD2.30) per share, almost 25 percent higher than the closing price on Jan. 18 when the firm received the offer. The hotel operator got listed in March 2019.

The offeror proposed to pay HKD1.51 billion (USD194.3 million) in the deal that valued New Century Hotel at HKD5.2 billion, Bloomberg reported on Jan. 20.

Kunpeng Asia is a Hong Kong-incorporated firm controlled by Sequoia China and Ocean Link. The latter private equity fund also led the privatizations of Chinese classifieds giant 58.Com and vehicle rental firm eHi Car Services.

New Century Hotel's original team of founders may gradually disappear and its strategy will be adjusted with the new director as the most important thing is to adapt to the business environment, insiders told Yicai Global.

Zheng, former Trip.Com vice president in charge of marketing, founded 7 Days in 2005. After that, he established Plateno Group, managing dozens of hotel brands. Jin Jiang International Holdings acquired Plateno in September 2015.

New Century Hotel made almost 41 percent less in gross profit at CNY335 million (USD51 million) last year from 2019, according to its earnings report. Its revenue fell by 17 percent to nearly CNY1.6 billion (USD245 million). The firm closed many hotels last year.

New Century Hotel's stock price [HKG: 1158] was 0.1 percent up at HKD18.02 this afternoon.

Editor: Emmi Laine, Xiao Yi