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Marriott CEO: More Hotel Mega-Mergers Are Coming

Leaders suggest no more action for Marriott-Starwood, but between remaining hoteliers.

More hotel chains could come together very soon, if a prediction by Marriott International chief executive Arne Sorenson comes to fruition. In an interview with Skift, the leader of both Marriott and Starwood Hotels noted the mega-merger period between hotel chains may not be at an end.

“Since we announced the deal in November of ’15, there’s been a lot of industry chatter about, ‘OK, this is the first big consolidation of this era. Other companies are going to have to follow,” Sorenson told the trade publication. “And I think that is because […] people understand the logic of it and think the logic makes sense. I think that’s one reason people say, ‘Alright other companies should follow.’”

Future mergers could center around Carlson Hotels, fully-owned by China’s HNA Group. The investor owns additional stakes in three other hospitality companies, including Rezidor Hotel Group, NH Hotel Group and Hilton Hotels. AccorHotels has also been rumored in seeking a merge partner, as the once-owner of Motel 6 has been linked to InterContinental Hotel Group (IHG).

While the Marriott-Starwood partnership has been hailed as a success, Sorenson warned that not all mega-mergers may be equally fruitful for all parties. The executive said that the arrangement between the two hotel chains worked because Starwood was “already for sale,” and both companies were dedicated to their deal. Furthermore, he continued that although the two companies completed the agreement, that alone was not a measure of the deal’s overall success.

Marriott won the rights to merge with Starwood after a contentious bidding process against a Chinese investor group led by Anbang Insurance. According to Skift, the insurance compay was also linked to an attempt to buy IHG, but denied the allegations.

[Photo: Shutterstock]

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