Starwood Hotels looking into Strategic and Financial Alternatives
Strategic and financial alternatives are being explored by Starwood Hotels & Resorts Worldwide and it said “no option is off the table”. Starwood owns the St. Regis and Sheraton hotel brands and its share jumped after the announcement. A sale of the company, an acquisition, or sale of the company’s hotels are some of the potential options available to the company.
The company is currently valued at about $14 billion. Quarterly profit of the company was higher than expected as a result of higher occupancy at its properties.
Starwood Hotels has sold properties worth about $1.5 billion over the past two years. The company has also spun-off its timeshare business. The company said in an announcement in February that long-time Chief Executive Frits van Paasschen had resigned.
The decision of Starwood to retain Lazard was meant to assist in exploring alternatives. Fortune’s Chris Matthews wrote about how an M&A frenzy could be spawned in the hotel industry by disruptive startups such as Airbnb.
A drop to $99 million, or 58 cents per share, in net income attributable to Starwood was seen in the first quarter ended March 31 from $137 million, or 72 cents per share.
The company earned 65 cents per share, excluding items. Fall in revenue was 2.9% to $1.42 billion. System-wide international occupancy sought a rise of 2.3% at Starwood properties.
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