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Well months of rumours and speculation can now be put to rest. We now know
who is buying Starwood Hotels & Resorts. Out of the blue came the news
this morning that Marriott International is planning to acquire one of
our favourite hotel chains! Nowhere had any mentioned Marriott before,
over the past year its been names like Hyatt, IHG, Chinese firms, etc.
who may buy Starwood but none of those are the winners. Wow is all we
can say. Marriott has been on a buying spree, Protea & Delta Hotels just to name a few!

a poster of a hotel

 Bethesda, MD, and Stamford, CT, November 16, 2015
– Marriott International, Inc. (NASDAQ: MAR) and Starwood Hotels &
Resorts Worldwide, Inc. (NYSE: HOT) announced today that the boards of
directors of both companies have unanimously approved a definitive
merger agreement under which the companies will create the world’s
largest hotel company.  The transaction combines Starwood’s leading
lifestyle brands and international footprint with Marriott’s strong
presence in the luxury and select-service tiers, as well as the
convention and resort segment, creating a more comprehensive portfolio.
 The merged company will offer broader choice for guests, greater
opportunities for associates and should unlock additional value for
Marriott and Starwood shareholders.  Combined, the companies operate or
franchise more than 5,500 hotels with 1.1 million rooms worldwide.  The
combined company’s pro forma fee revenue for the 12 months ended
September 30, 2015 totals over $2.7 billion. 

What does that mean now and in the future? Now it is
status quo, you continue on with earning and redeeming with Starwood
Preferred Guest and/or Marriott Rewards. If the transaction is approved
they hope it will close in mid-2016. Ultimately we believe his means
integration of Starwood Preferred Guest into Marriott Rewards sometime
after that. More than likely not until 2017. Seeing that there was
nearly a one year timeline to integrate Delta Privilege (a much smaller
program than SPG) into Marriott Rewards you can just imagine what the
integration will entail of the 21 Million SPG members into Marriott
Rewards. There is a good chance that many of the perks and benefits of
SPG will be lost seeing that Marriott Rewards is a much larger program
and frequently wins awards even though it doesn’t have the prowess of
SPG.

In terms of hotels, Marriott may just continue to run all the Starwood
brands under their current names, Sheraton, Westin, Aloft etc. and never
name them Marriott’s. Some of those names are iconic and shouldn’t be
messed with and Marriott knows this.

Of course it is too early to say any of this definitively but if past
experience dictates what will happen here then at the very least we know
at least some of what we speculate above will actually come true.

What are your thoughts on this news?

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