Marriott to buy Starwood for $12.2 billion
Marriott International Inc. announced on Monday that it has bought Starwood Hotels and Resorts Worldwide Inc. for $12.2 billion (£8 billion), creating the world’s largest hotel company. Starwood’s brands include Westin, the W, Sheraton and St. Regis. Previously Hyatt Hotels Corporation and InterContinental Hotels Group had been rumoured purchasers, as well as a number of Chinese companies.
Starwood recently underwent leadership changes, with Chief Executive Frits van Paasschen resigning and being replaced by Adam Aron. The company said in April that it was working on a financial resolution, including a potential sale. Since that month, both Marriott and Starwood’s shares have declined by at least 9% in value.
Now combined, Marriott and Sherwood will have more than 5,500 hotels (owned and franchised combined), with 1.1 million rooms.
Of the $12.2 billion price agreed, $11.9 billion will be paid in stock and the remaining in cash, which represents less than 3% of the deal. Marriott will pay $72.08 per share for Starwood. It is unclear as of now how this will affect loyalty schemes that customers have with the various brands encompassed by the deal.