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IHG has upscale hotels in world capitals like the Willard InterContinental in Washington D.C. (Image: SebastianToulouse/Flickr)
Last year there was speculation in the lodging and financial industries that Starwood Hotels might be looking to acquire a huge rival: InterContinental Hotels Group (IHG).
Nothing came of that talk, and it later emerged that the real potential suitor for IHG in that case was Wyndham Hotels, not Starwood. But with the announcement this week that Starwood is exploring “strategic and financial alternatives to increase shareholder value,” talk of a run on IHG is starting up again.
Just after the Starwood statement, the price of IHG shares in London jumped almost 6 percent, according to Bloomberg News, as the market suspected the latter company could figure into Starwood’s future plans as a potential acquisition target– although Starwood stressed that it has no timetable for its strategic review.
This would be an interesting combination for frequent travelers. IHG’s Rewards Club is the largest hotel loyalty program in the world. Starwood’s Preferred Guest program is undeniably one of the most popular. A mash up of the two programs would expand earning and burning opportunities like crazy.
Mergers and acquisitions are riding high in the hotel business these days. IHG recently completed the acquisition of San Francisco-based boutique chain Kimpton Hotels, with plans to expand it overseas; and Marriott has made strategic purchases to bolster its overseas inventory, including Africa’s Protea Hotels and Canada’s Delta Hotels.
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Starwood brands include Aloft– this one by SFO (Image: Chris McGinnis)
But the vague wording of Starwood’s announcement did not preclude a possible sale of the company to someone else if that were determined to be the best way to enhance shareholder value.
“No option is off the table,” Starwood said, adding that it has retained Lazard to advise it on its best options.
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Besides InterContinental Hotels, IHG’s brands include Holiday Inn, Holiday Inn Express, Crowne Plaza, Indigo, the new Even Hotels, Staybridge Suites and Candlewood Suites. Among Starwood’s brands are the Luxury Collection, St. Regis, Westin, Sheraton, W, Four Points by Sheraton, Le Meridien, Aloft and Element.
Would you like to see Starwood and IHG merge? It would sure create a whopper of a hotel loyalty program. But fewer players in any industry usually translates to higher prices…. thoughts, please!
NOTE: Be sure to click here to see all recent TravelSkills posts about: United’s new 50,000 mile bonus + Easy 1,000 AAdvantage miles + The most outrageous luxury suites in the sky +Delta bumps up summer seats to Europe!
Bottom line: Less choices with less benifits.
While I’m grateful to IHG for their footprint, which has served me well many times, the program in no way resembles SPG. For SPG to acquire all IHG properties and assimilate them into their program would be amazing, but that seems unlikely. I would rather have SPG do their thing and IHG do theirs, as opposed to a huge SPG+IHG with a watered down Preferred Guest program.