In the weeks-long bidding war for Starwood, Anbang’s latest offer was demonstrably superior to Marriott’s, at least in the short term. And it appeared that Marriott was standing pat, hoping that Starwood shareholders would buy the argument that a Marriott-Starwood tie-up could deliver better returns over the long term.
As things stood, there was a better-than-even chance that Anbang would be Starwood’s new owner after a shareholder vote on April 8.
But then, this afternoon, Anbang issued the following statement:
We were attracted to the opportunity presented by Starwood because of its high-quality, leading global hotel brands, which met many of our acquisition criteria, including the ability to generate consistent, long-term returns over time. However, due to various market considerations, the Consortium has determined not to proceed further. We thank the Starwood Board, management team and its advisors for their efforts and support throughout this process.
So, barring a last-minute bid from a new entrant, it appears that Starwood will go to Marriott, creating, as the deal’s proponents touted, the world’s largest hotel company.
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The scale of the combined companies may indeed create economies of scale and marketing synergies, leading to improved returns for stockholders. Wall Street was skeptical, however: In after-hours trading, Starwood’s share price was down 4.35 percent and Marriott’s was down 5.72 percent.
Whether a larger Marriott will be a better-for-customers Marriott is an even less certain proposition.
Reader Reality Check
Will combining Marriott and Starwood be better for either company’s customers?
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After 20 years working in the travel industry, and 15 years writing about it, Tim Winship knows a thing or two about travel. Follow him on Twitter @twinship.
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Enter the Holland America Line “Choose Your Cruise” sweepstakes by March 31, 2016, for a chance to win the grand prize: a seven-day Holland America Line cruise for two to the winner’s choice of Alaska, Canada and New England, the Caribbean, or Europe, including most onboard meals.
Enter the Budget Travel “Iceland” sweepstakes by February 19, 2016, for a chance to win the grand prize: a trip for two to Iceland, including air, nine nights’ hotel, some meals, and local tours.
It’s been awhile since Hyatt’s last systemwide bonus promotion. That will be remedied beginning next month, with a new offer that, at least for high-frequency travelers, will have been well worth the wait.
It’s a fact of loyalty-program life: Airline and hotel programs periodically adjust their award prices. Of course, those adjustments amount to price hikes more often than not. And, all things being equal, higher award prices amount to an overall devaluation of the program.
While the Marriott acquisition of Starwood closed in September, the two companies’ integration is far from complete. In particular, Marriott Rewards and Starwood Preferred Guest continue to operate independently, although members may now link their accounts, transfer points, and have their status matched.
Enter the Jarlsberg “Perfect Pairing” sweepstakes by September 12, 2016, for a chance to win the grand prize: a four-night trip for two people to Oslo, Norway, including air and hotel.
Enter the American Airlines “Your Vacation Spot” sweepstakes by April 1, 2016, for a chance to win the grand prize: a $10,000 American Airlines Vacations travel voucher.
For years, Marriott has been referring to its periodic systemwide promotions as MegaBonuses. Early on, when the offer was a free night after two paid stays, the name was apt. But recently, the offers have been much less generous; they were more mini than mega. The offers also became more complicated over the years, based on a targeting scheme that generated customized bonuses according to members’ stay histories and other factors known only to Marriott.
Enter the Clos Du Bois “Spring in Sonoma” sweepstakes by April 26, 2016, for a chance to win one of the two grand prizes: trips for two to Sonoma, including air, three nights’ hotel, and $700 spending money.
Marriott’s acquisition of Starwood has left one key group vocally underwhelmed: members of Starwood’s Preferred Guest program, particularly Starwood elites who have become accustomed to perks and services that play no part in Marriott’s Rewards program.
Enter the Liberty Richter “Kitchens of India” sweepstakes by June 15, 2016, for a chance to win the grand prize: a six-day trip for two to New Delhi, India, including air, transfers, and hotel.