Marriot completes $12.4bn Starwood acquisition
MARRIOT International, the Nasdaq listed hotel group that has an ambitious growth strategy across the Middle East and Africa (MEA) region, has completed its $12.4 billion (R169.54bn) acquisition of Starwood Hotels & Resorts Worldwide to create the world’s largest hotel company.
The new company will operate or franchise more than 5 700 properties and 1.1 million rooms, representing 30 leading brands from the moderate-tier to luxury in more 110 countries. The completion of this acquisition has resulted in Marriott more than doubling its hotel distribution in Asia and the Middle East.
Marriott International earlier this month reported that it had signed 14 new properties across the MEA region to add to its current operating portfolio of 147 hotels in 20 countries. It also confirmed it would open 11 new properties across the region by the end of this year.
Marriott International plans to add a further 74 properties and about 16 169 rooms within the MEA region by 2020, to bolster its total regional footprint to 221 properties and 40 816 rooms. Arne Sorenson, the president and chief executive of Marriott International, said the acquisition enabled the combined company to expand the scope of its distribution and portfolio while deploying its larger scale to realise cost efficiencies in its corporate and property operations.
Marriott has expressed confidence the company could achieve $250 million in annual cost synergies apart from leveraging operations and sharing best practices. Sorenson said these enhanced efficiencies and revenue opportunities should drive improved property level profitability.