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Marriott expects $250m synergies from $13bn Starwood deal

Marriott International expects to extract $250 million in annual cost savings through its takeover of Starwood Hotels & Resorts.

The $13 billion merger was completed today with the enlarged company pledging to retain all 30 brands while linking their respective loyalty programmes.

The deal creates the world’s largest hotel conglomerate with more than 5,700 properties and 1.1 million rooms in over 110 countries.

Marriott’s distribution has more than doubled in Asia and the Middle East & Africa combined as a result of the acquisition.

Marriott president and chief executive, Arne Sorenson, said: “We believe that Marriott now has the world’s best portfolio of hotel brands, the most comprehensive global footprint, and the most extensive loyalty programmes, providing an unparalleled guest experience.

“Combining Starwood’s brands with ours better enables Marriott to reach our goal of having the right brand in the right place to serve our loyal guests and welcome new ones.

“We can now provide a better range of choices for our guests, more opportunities for our associates, and greater financial benefits for our owners, franchisees, and shareholders.”

Marriott is confident it can achieve $250 million in annual corporate “cost synergies”.

Combined sales expertise and improved account coverage are expected to provide both enhanced efficiencies and increased revenue opportunities for managed and franchised properties, the company said.

Sorenson added: “These enhanced efficiencies and revenue opportunities should drive improved property-level profitability as well as greater owner and franchisee preference for the combined company’s brands, which will encourage new hotel development.

“As new travel destinations emerge, Marriott can be counted on to be there.”

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