Photo: St Ermin's Hotel London

Marriott buys Starwood Hotels

What happens when one of the world’s leading hotel chains buys its biggest rival? Simple, you get the world’s biggest hotel group, one that now offers more than 5,500 hotels and 1.1 million rooms worldwide.

Marriott International has committed to buy Starwood Hotels & Resorts Worldwide in a deal worth US$12.2 billion (AUD$17.2 billion). The combined company will include brands such as Sheraton, Autograph Collection, and Ritz Carlton, and give Marriott a much greater presence in Europe.

St Ermin's Hotel London. Photo: Marriott Hotels
St Ermin’s Hotel London. Photo: Marriott Hotels

Marriott’s president & CEO, Arne Sorenson, says the purchase is about growth, an essential ingredient to future proof the hotel group in the marketplace.

“The driving force behind this transaction is growth. This is an opportunity to create value by combining the distribution and strengths of Marriott and Starwood, enhancing our competitiveness in a quickly evolving marketplace,” he said.

“This greater scale should offer a wider choice of brands to consumers, improve economics to owners and franchisees, increase unit growth and enhance long-term value to shareholders. Today is the start of an incredible journey for our two companies.”

The acquisition of Starwood marks the latest and most significant step in Marriott’s recent expansion-through-acquisition strategy.

In April 2014, Marriott completed a US$200 million (AUD$281 million) deal to buy South Africa’s Protea Hospitality Group, making it the largest hotel chain in Africa. Earlier this year, it bought Canada’s Delta Hotels & Resorts for US$134m.

On the merger, Starwood Chairman Bruce Duncan said: “During our comprehensive review of strategic and financial alternatives, it was clear that our talented people, world-class brands, global leadership and spirit of innovation were much admired and key drivers of our value.”

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Written by
Chris Ashton

We're Chris Ashton and Simon Ceglinski, two Aussie travellers with a love of exploration and adventure, and the odd bit of luxury thrown in. We seek out street art, street food, and scuba diving wherever we go, and prefer the road less travelled over well-worn tourist paths.

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Written by Chris Ashton