The new company, Branded Hotel Management (BHM), is designed to help Legacy, which operates 21 hotels under its own name in the UK, expand into the branded market and Longrose Buccleuch, operator of hotels under the Doubletree by Hilton, Mercure and Best Western brand, grow its market share.
Legacy chief executive Andy Townsend said: "Over the last seven years Legacy has built a very solid reputation for shrewd and effective management of three and four star un-branded hotels across the UK. As a result we have built an infrastructure of both people and support services that enable us to expand our portfolio offering.
"We wanted to partner a company which had the experience but was looking to grow. Longrose Buccleuch perfectly fitted the bill."
BHM will have Townsend and Legacy managing director Jim Gordon on its board along with Longrose Buccleuch directors Garin Davies and Andrew Rouse.
Davies, whose company currently operates the The Mercure Dolphin Hotel, Southampton, the DoubleTree by Hilton Sheffield Park Hotel, and the Best Western Mosborough Hall Hotel, also in Sheffield, said it was well placed to operate more hotels, but needed a larger infrastructure in order to do it.
"We have spent several months refining our offer to the stakeholders of branded hotels and believe that the timing is spot on for a new, dynamic and fresh approach within the sector," he added.
News of the launch was released ahead of the Annual Hotel Conference , which takes place in Manchester this week where Davies and Townsend will be both be in attendance.
BHM said it was already having 'positive' discussions with international hotel brands about new developments and taking over existing properties.