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Marriott Edges Closer to Purchasing Starwood


Marriott International, one of the world’s largest hotel companies, is edging closer to buying Starwood Hotels & Resorts in a $12.2 billion merger that would create one of the world’s largest hotel companies.

This merger brings together 30 brands between the two companies. Westin and Sheraton are Starwood’s two largest brands, while Marriott International owns the signature Marriott Hotels and Resorts, along with Residence Inn and Courtyard.

When completed, the combined entity will operate or franchise about 5,700 hotels with 1.1 million rooms globally. Marriott reported revenues of more than $14 billion from fiscal year 2015, while Starwood reported revenues of $5.76 billion in 2015.

“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,” Arne Sorenson, president and CEO of Starwood Hotels, said.

Bruce Duncan, chairman of the board of directors of Starwood, added, “Our board concluded that a combination with Marriott provides the greatest long-term value for our shareholders and the strongest and most certain path forward for our company.”

With its current stable of 759,330 rooms around the globe, Marriott is one of the largest operators of franchised hotel properties. Its portfolio is approximately 69.5 percent franchised, while Starwood brands are approximately 49.5 percent franchised.

With recent antitrust approvals from the Saudi Arabian and Mexican governments, the proposed mega-merger is reaching its final stages following clearance from antitrust regulators in the EU, United States, Canada and other countries.

Regarding the European Union’s approval, Margaret Vestager, commissioner for completion at the European Commission, favored the deal, saying the commission’s investigation confirmed that the hotel sector would remain competitive in Europe following the merger.

Until the merger is legally complete, the two companies will remain operating as separate and self-governing entities. Stockholders of both companies showed overwhelming approval to the merger; 97 percent of Marriott’s shareholders voted in favor of the proposal, while 95 percent of Starwood shareholders approved the unification.

“The implications are potentially huge. We think the new Marriott/Starwood group is going to have a lot of say in the market, which could alter the way corporate rooms are bought and sold,” Carlson Wagonlit Travel analyst Scott Brennan said.

Marriott and Starwood await approval from the Chinese regulatory agency, and will close the deal as soon as they receive authorization from China, which could happen by the end of the month. 

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The latest news, opinions and commentary on what's happening in the franchise arena that could affect your business.

Laura MichaelsLaura Michaels is editor of Franchise Times. She can be reached at 612.767.3210, or send story ideas to lmichaels@franchisetimes.com.
Beth EwenBeth Ewen is senior editor of Franchise Times. She can be reached at 612.767.3212, or send story ideas to bewen@franchisetimes.com.
Nicholas UptonNicholas Upton is restaurants editor at Franchise Times. He can be reached at 612.767.3226, or send story ideas to nupton@franchisetimes.com.
Mary Jo LarsonMary Jo Larson is the publisher of Franchise Times Magazine and the Restaurant Finance Monitor.  You can find her on Twitter at




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