Marriott International to buy Starwood Hotels in €12.2bn deal to create world’s biggest hotel chain

Marriott International will buy Sheraton owner Starwood Hotels & Resorts Worldwide in a $12.2bn (€11.4bn) deal to create the world’s largest hotel chain.

Marriott International to buy Starwood Hotels in €12.2bn deal to create world’s biggest hotel chain

The combined company will own or franchise more than 5,500 hotels with 1.1m rooms worldwide, giving Marriott greater presence in markets outside the US.

Starwood, which gets nearly two thirds of its revenue from outside the US, had essentially put itself up for sale in April, when it said it was considering strategic alternatives.

Starwood shareholders will receive 0.92 Marriott Class A shares and $2 in cash for each Starwood share. This works out to $72.08 per share for Starwood, a discount of about 4% to the stock’s Friday close.

Starwood shareholders will also get about $7.80 per share from the spin-off of its timeshare business and subsequent merger with Interval Leisure Group.

Starwood shares were down 3.3% at $72.50 in pre-market trading yesterday, while Marriott shares were up 1.7% at $74.01.

“This greater scale should offer a wider choice of brands to consumers, improve economics to owners and franchisees, increase unit growth,” said Marriott chief executive Arne Sorenson, who will head the combined company.

Marriott said it expected one-time transaction costs of $100m-$150m related to the deal and expects the acquisition to add to earnings from the second year after it closes, which is expected to happen in mid-2016.

More in this section

Lunchtime News Wrap

A lunchtime summary of content highlights on the Irish Examiner website. Delivered at 1pm each day.

Sign up

Discover the

Install our free app today

Available on

Revoiced
Newsletter

Our Covid-free newsletter brings together some of the best bits from irishexaminer.com, as chosen by our editor, direct to your inbox every Monday.

Sign up