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Marriott-Starwood, the official birth of a new giant

The acquisition of Starwood Hotels by Marriott International was finalized this Friday, confirming the the creation of a new global hotel leader. Discover the impact this merger may have worldwide on the different markets.

The merger between Marriott International and Starwood Hotels & Resorts is official, leading to the creation of the new leader worldwide after a transaction estimated at 13 billion dollars. This alliance brings the group a full portfolio affecting a wide array of segments from the budget category to upscale, consisting of the following brands:

  • Luxury: Ritz Carlton, Bulgari, Ritz Carlton Reserve, Edition, JW Marriott, Autograph Collection, Luxury Collection, St Regis, Tribute Portfolio, W Hotels, Design Hotels

  • Upscale: Renaissance, Marriott, Delta Hotels, Gaylord Hotel, AC by Marriott, Courtyard,  Sheraton, Le Méridien, Westin 

  • Extended stay: Residence Inn, SpringHill Suites, Fairfield Inn & Suites, TownPlace Suites, Element

  • Africa: Protea Hotels,

  • Midscale: Moxy, Four Points, Aloft

Geographically, close to 70% of the group's supply is in North America where the new ensemble operates a portfolio that now includes 4,206 properties totaling 753,097 rooms, making it the leading operator in North America. The group also became the leader in Africa, with 49,563 rooms in 239 hotels. In Europe, the new conglomerate has 494 properties, or 101,344 rooms; this portfolio places it 3rd after AccorHotels (300,958 rooms) and IHG (104,158 rooms). Finally, it has 60,153 rooms in the Asia-Pacific area.

This acquisition will allow the group to expand its distribution and its portfolio while realizing cost savings. This should also lead to an internal reorganization, necessarily including some lay-offs, such as that of the President for Europe, Africa and Middle East at Starwood Hotels and Resorts, Michael Wale. This reorganization is estimated at 140 million dollars.

On this occasion, Arne Sorenson, President and General Marriott International declared: "Combining Starwood's brands with ours better enables Marriott to reach our goal of having the right brand in the right place to serve our loyal guests and welcome new ones. We can now provide a better range of choices for our guests, more opportunities for our associates, and greater financial benefits for our owners, franchisees, and shareholders." 

Through this merger, Marriott's board of administration welcomes three new members: Bruce Duncan, former chairman of the board at Starwood Hotels & Resorts Worldwide and President and CEO at First Industrial Realty Trust; Eric Hippeau of Lerer Hippeau Ventures; and Aylwin Lewis, CEO Potbelly Corporation. Eric Hippeau and Aylwin Lewis are also former members of the board of administration at Starwood.

As of January 1, 2016, the new ensemble of Starwood Hotels & Resorts and Marriott International became the leading hotel group worldwide, with 5,640 hotels for a total of 1,108,852 rooms worldwide, according to data published by Hospitality ON.

Also read:

  • Marriott announces acquisition of Starwood Hotels group
  • Jin Jiang, Plateno and Starwood, a new global hotel giant ?
  • Will Starwood Hotels & Resorts be sold, rented, or offered a merger proposal ?
  • Interview with Michael Wale, Starwood Hotels & Resorts
  • Chinese investors interested in purchasing Starwood Hotels & Resorts
  • Sale of Starwood Hotels: how might it affect the hotel world?

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