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Is Hyatt about to buy Starwood Hotels and Resorts?


Merger of hotel giants could be imminent

In a deal that may be announced as soon as next week, Hyatt Hotels is believed to be in talks to buy Starwood Hotels and Resorts.

 

A source close to the matter told Reuters Hyatt’s management would control the combined company, however neither group has confirmed the negotiations.

 

The Westin Sydney Hotel

 

Owner of the Westin, Sheraton and W Hotel brands, among others, Starwood is valued at around US$12.75 billion while Hyatt has a valuation of about $7.23 billion.

 

"My hunch is they (Hyatt) would be able to (buy Starwood). They could pull it off but it would be a stretch," said Argus Research Co analyst John Staszak. But Staszak said a foreign acquirer might be more desirable as it could pay more.

 

A source told Reuters three Chinese groups had also expressed an interest in the acquisition, while Starwood had reached out to potential bidders including UK-based InterContinental Hotels Group and Wyndham Worldwide Corp in July, three months after it decided to explore a sale.

 

MORE ON STARWOOD:

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According to Forbes, Hyatt’s worldwide portfolio consists of 587 properties (around 155,000 rooms) while Starwood has 1,222 properties (around 354,000 rooms) as of end of 2014.

 

A combined group would still have less than Marriott’s and Hilton’s portfolio of 700,000 plus rooms each. But if Hyatt succeeded in buying Starwood, the American-focused group would significantly enhance its global footprint as nearly half (45%) of Starwood’s properties lie outside of the Americas region.

 

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Written by: Mark Harada
Published: 2 November 2015


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