AccorHotels, Europe's largest hotel company, said on Wednesday it was buying the owner of luxury hotels including London's Savoy and New York's Plaza in a cash-and-share deal worth $2.9 billion.

The deal, AccorHotels' biggest, is the latest in a wave of acquisitions in a sector trying to fend off new competition from online rivals such as AirBnB and will see two major Gulf investors taking stakes in the French company.

The Paris-based company said in a statement it would pay for FRHI Holdings Ltd - parent of the Fairmont, Raffles and Swissotel chains - with $840 million in cash and by issuing 46.7 million new shares.

The capital increase will leave the Qatar Investment Authority with a 10.5 percent stake in Accor and Kingdom Holding 4280.SE, Saudi billionaire Prince Alwaleed bin Talal's investment company, with 5.8 percent.

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Two QIA representatives will be appointed to AccorHotels' board and Kingdom Holding will have one, Accor's Chief Executive Sebastien Bazin said on a conference call.

An extraordinary shareholders meeting is due to be held in the second half of 2016.

The company said the deal would boost earnings starting from the second year with 65 million euros in revenue and cost synergies expected.

The deal follows on the heels of Marriott International Inc's $12 billion takeover of Starwood Hotels & Resorts Worldwide Inc earlier this year to create the world's largest hotel group..

AccorHotels, which competes with InterContinental (IHG.L) and Starwood as well as Marriott, is undergoing a reorganization under Bazin who took the top post two years ago.

Bazin said on Wednesday that the objectives set under the reorganization plan remained intact.