Starwood Hotels & Resorts is exploring “strategic and financial alternatives,” the company announced Wednesday, creating speculation as to whether the high-end hotel giant will sell, merge or spin off.
“No option is off the table,” Starwood chairman Bruce Duncan said Wednesday on a conference call with analysts, the Wall Street Journal reported.
Starwood’s slow growth led to the resignation of CEO Fritz van Paasschen in February. The company’s first quarter profit fell to $99 million, or 58 cents a share, from $137 million, or 71 cents, in 2014. Revenue fell 2.9 percent to $1.4 billion.
“Starwood’s inability to sell hotel owners on its select service brands forced it to put its hand up for help” via a merger or acquisition, Chad Beynon, a lodging analyst at Macquarie Securities Group, said to the Wall Street Journal. “The most likely outcome is sale of company,” he said.
In South Florida, Starwood’s hotels include the St. Regis in Bal Harbour, W Fort Lauderdale and W South Beach.
Starwood recently announced that it would operate the Royal Palm Hotel Miami Beach, which sold to Chesapeake Lodging Trust for $278 million in February. Starwood is also working with Jason Halpern’s New York-based JMH Development on Aloft South Beach, opening May 28.
Starwood, based in Stamford, Connecticut, has expanded faster oversees than its rivals but has half the number of rooms of Marriott International and Hilton Worldwide Holdings. The company will soon release plans to reinvigorate its Sheraton brand, which accounts for more than 40 percent of the company’s room total. [WSJ] — Katherine Kallergis