Marriott International and Starwood Hotels and Resorts Worldwide announced on 17 November 2015 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. All this for a cool cost of US$12.2 Billion in one of the most talked about hotel deals of all time.
On Monday, 16th November 2015, the Marriott group announced that it would acquire Starwood for $11.9 billion in stock and $340 million in cash. That means cash was used for a mere 2.8 percent of the deal, which is the seventh-lowest percentage on record for cash-and-stock deals greater than $10 billion
The combined company will own or franchise more than 5,500 hotels with 1.1 million rooms worldwide and give Marriott greater presence in markets such as Europe, Latin America and Asia including India and China in this deal.
Marriott has purchased a number of hotel companies in recent years and in 2014, it acquired Cape Town-based Protea Hospitality Group for about US$186 million, making it the largest hotel company in Africa. In early 2015, it became the largest full-service hotelier in Canada with the US$135 million purchase of Delta Hotels and Resorts in North America.
On the loyalty rewards programs for both properties, the Marriott and Starwood have 54 million members and 21 million members, respectively. But the companies have yet to decide when, or how, those two programs will be combined.
This current 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.
After the transaction closes, which his expected around mid-2016, the company is expected to add three Starwood members to its board, which will expand to 14 members. This is currently the much talked about hotel industry news around the world where Marriott International is to buy Starwood Hotels and Resorts Worldwide.