1st US com­pany to run Cuba ho­tels in decades

The Pak Banker - - COMPANIES/BOSS -

Star­wood Ho­tels and Re­sorts has an­nounced that it has signed three ho­tel deals in Cuba, the first time a US ho­tel com­pany has done so in al­most 60 years.

Star­wood beat out sev­eral other U.S. hos­pi­tal­ity com­pa­nies that have been try­ing to in­vest in ho­tels in Cuba, in­clud­ing Mar­riott In­ter­na­tional. Mar­riott CEO Arne Soren­son is ac­com­pa­ny­ing Pres­i­dent Barack Obama on his his­toric trip to the Com­mu­nist is­land na­tion Sun­day.

Star­wood re­ceived au­tho­riza­tion from the U.S. Trea­sury Depart­ment to op­er­ate ex­ist­ing ho­tels in Cuba. The Ho­tel Inglaterra in Ha­vana will join Star­wood's Lux­ury Col­lec­tion brand. The Ho­tel Quinta Avenida, also in Ha­vana, will be­come a Four Points by Sher­a­ton. Both ho­tels will un­dergo ren­o­va­tions be­fore be­com­ing Star­wood prop­er­ties later this year.

The com­pany also has signed a let­ter of in­tent to con­vert the Ho­tel Santa Isabel in Ha­vana into a Lux­ury Col­lec­tion prop­erty.

"We have an amaz­ing and com­pelling num­ber of brands. We are very strong in Latin Amer­ica," Jorge Gian­nat­ta­sio, Star­wood's se­nior vice pres­i­dent and chief of Latin Amer­ica Op­er­a­tions, said in a phone call to USA TO­DAY from Ha­vana. "We know how to do busi­ness in the area. When no one thought it was pos­si­ble, we made the right ar­gu­ment and we got the li­cense."

Mar­riott has also re­ceived Trea­sury ap­proval but has yet to an­nounce any ho­tel deals.

Obama be­gan nor­mal­iz­ing re­la­tions with Cuba in De­cem­ber 2014. A U.S. em­bassy in Cuba re-opened last Au­gust. And last month, the two na­tions signed an agree­ment to let U.S. air­lines op­er­ate daily round-trip flights to Cuba. All ma­jor U.S. air­lines are now vy­ing for the right to do so.

While U.S. cit­i­zens still can­not travel to Cuba strictly for tourism, they can go there un­der 12 ap­proved cat­e­gories in­clud­ing religious and ed­u­ca­tional ac­tiv­i­ties.

Star­wood is tak­ing ad­van­tage of a geopo­lit­i­cal shift while also try­ing to ne­go­ti­ate its own fu­ture as it con­sid­ers com­pet­ing suit­ors for a buy­out.

On Fri­day, Star­wood dropped a $12.2 bil­lion bid from Mar­riott to take over the com­pany in fa­vor of a $13 bil­lion all cash of­fer from a con­sor­tium of in­vestors led by Chi­nese in­sur­ance com­pany An­bang.

Star­wood has given Mar­riott through March 28 to make a coun­terof­fer. Mar­riott said on Fri­day that it was eval­u­at­ing the An­bang of­fer and con­sid­er­ing its op­tions. If it is com­pleted, the Mar­riott-Star­wood merger would turn the duo into the largest ho­tel com­pany in the world. Soren­son, who is vice chair of Obama's Ex­port Coun­cil, would be­come the CEO of the com­bined com­pa­nies.

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