CanadaDH

Wouldn't that be most of their properties? I didn't think that Fairmont owned very many of the properties at all they manage today, unlike in the days before CP Hotels bought Fairmont. And if the current owners of the individual properties are free to change management companies (and I assume they are, subject to some exit clause in their contract), I don't imagine very many of them wanting their high profile properties associated with IHG.

I'm trying to picture the "Holiday Inn Chateau Frontenac", or the "Crown Plaza Banff Springs", or "The Savoy, an IHG managed hotel"--really? I can't imagine any of the property owners degrading their iconic properties like that. And if it's likely many of the properties would pull out after such a merger, there's really not much value in it.

I only see a merger working if it's with a chain of a similar perceived quality. I could see IHG buying the chain and continuing to operate it as is, possibly finding some head office synergies, and with no changes to the branding or mixing of the customer facing aspects, but a merger of the brands would be a real value killer--for the owners of the chain, the owners of the properties, and for their guests. I just don't see them as the most synergistic buyer out there, and if I was the current owners of Fairmont looking to sell, I'd be waiting until someone with a more upscale chain was interested, as they should theoretically be able to offer a higher price, since they would be able to integrate the chain to gain synergies without killing the brand equity.

I really hope there's no truth to this. If it does happen, they need to keep them separate. Volkswagen owns Rolls Royce, but you're not going to see them flogging a Jetta on the showroom floor next to a Bentley--I don't think they even want the customer to know they're remotely connected. I hope IHG doesn't try to combine them.