News

Recent mergers in the travel industry

13 Apr 2016 by Clement Huang

MARIOTT INTERNATIONAL AND STARWOOD HOTELS & RESORTS

WHEN WAS IT ANNOUNCED? November 2015

DATE OF MERGER Mid-2016

VALUATION US$13.6 billion

BACKGROUND INFO The merger between Marriott and Starwood is finally close to completion, as shareholders of both companies have voted to approve the deal. The transaction appeared on the rocks just a few weeks ago, following a rival bid from a Chinese consortium led by insurance giants Anbang (see here). However, the offer was eventually dropped, allowing both companies to resume the integration process.

WHAT DOES THIS MEAN? The merger will create the world's largest hospitality company with over 30 brand, 5,500 hotels and over one million rooms. Both Starwood Preferred Guest and Marriott Hotel Rewards loyalty programmes are also set to be combined, although this will not happen until 2018. 

marriott.com and starwoodhotels.com

 

ACCORHOTELS AND FRHI

WHEN WAS IT ANNOUNCED? December 2015

DATE OF MERGER 2016

VALUATION US$2.9 billion

BACKGROUND INFO Accor Hotels signed an agreement for the acquisition of FRHI Holdings – parent company of Fairmont, Raffles and Swissotel. The French group paid for the acquisition by issuing 46.7 million new Accor shares and cash payment of US$840 million. 

WHAT DOES THIS MEAN? Previously, Accor’s footprint in the luxury hotel segment was limited to its Sofitel brands. FHRI extends this with an additional 155 luxury hotels and resorts, 40 of which are under development, in 34 countries across five continents.

accorhotels.com and frhi.com

 

JIN JIANG INTERNATIONAL AND PLATENO GROUP

WHEN WAS IT ANNOUNCED? July 2015

DATE OF MERGER September 2015

VALUATION US$1.3 billion

BACKGROUND INFO The merge saw Jin Jiang’s parent company, Jin Jiang International (Holdings) Co Ltd acquire a majority 81 per cent stake in Plateno. Moving forward, the partners foresee further major expansion in the international hotel market by what they describe as “the most competitive, innovative and dynamic global hotel group”.

WHAT DOES THIS MEAN? The merge has helped create China’s largest hotel group and one of the world’s top five. The tie-up effectively forms a combined portfolio of over 6,000 hotels with more than 640,000 guestrooms in 55 countries. While both Jin Jiang and Plateno continue to operate their respective brands independently, an integrated booking engine is currently under development, which would allow customers to book hotels under both groups through a single system. 

platenohotelsgroup.com and jinjianghotels.com.cn

 

ALASKA AIRLINES AND VIRGIN AMERICA 

WHEN WAS IT ANNOUNCED? April 2016

DATE OF MERGER est. 2016

VALUATION US$4 billion

BACKGROUND INFO Alaksa Airlines has been looking to bolster its position as a competitor to the four largest US airlines (America, Delta, Southwest and United). The merger will result in the combined airline offering 1,200 daily departures from hubs such as Seattle, San Francisco, Los Angeles, Anchorage, Alaska and Portland, Oregon - putting it in a strong competitive position within the US aviation industry.

WHAT DOES THIS MEAN? Alaska’s customers will gain increased access to slot-controlled airports such as Ronald Reagan Washington National Airport and the two New York City-area airports. Meanwhile, Virgin America customers stand to benefit from expanded services to technology markets in Silicon Valley and Seattle, while the combined airline will also offer more connection opportunities to international airline partners departing Seattle, San Francisco and Los Angeles.

flyingbettertogether.com

 

Clement Huang

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