Marriott International said Monday it has completed a $1 billion acquisition of Renaissance Hotels Group, a Hong Kong-based operator and franchiser of 150 hotels in 38 countries.
A spokesman for Marriott, based in Washington, D.C., said Renaissance shareholders were paid $30 per share in cash. The $1 billion included transaction costs and Marriott taking over some $50 million in Renaissance debt.The merger gives Marriott greater exposure to international travelers and makes it more competitive in overseas markets with such hotels as Hilton and ITT Sheraton.
Marriott International chairman and chief executive officer J.W. Marriott Jr. said the acquisition adds three "premier" brands to Marriott's hotel business and more than doubles the company's presence in markets outside the United States.
"We have significantly expanded our access to customers in new and emerging markets worldwide with the addition of these powerful brands," Marriott said in a release.
Those brands include Renaissance, an international hotel for business and leisure travelers; New World, located in Asia and the Pacific region; and Ramada International, a mid-priced hotel that operates outside of the United States and Canada.
"We are now becoming a truly global hotel company," he said, noting that for the first time in Marriott's 40-year history, it has hotels in Japan, Italy, China, Russia, India and Turkey.
Although the hotel chain was founded in 1957, the Marriott business began 62 years ago with an A&W Root Beer stand in Washington, D.C., started by the late J. Willard Marriott, a former Utahn and the father of the current chairman and CEO.
While Marriott's businesses were based in the Washington, D.C., area, the Marriott family has maintained close ties to Utah, donating funds for facilities such as the Marriott Library at the University of Utah and the Marriott Center sports arena at Brigham Young University.
As part of the acquisition, Marriott also gained a "strategic alliance" for future hotel development with New World Development Co., based in Hong Kong and the major shareholder in Renaissance prior to the acquisition.
Renaissance Hotel Group also licenses the Ramada name in the United States and Canada to others under long-term agreements.
Of the 30.10 million Renaissance Hotel Group shares outstanding at the time of Marriott's tender offer, 30.06 million were sold to Marriott. By the offer deadline of Friday, March 29, 31,401 shares had not yet been tendered.
Marriott International is the world's largest hotel company with some 4,700 operating units in the United States and 30 other countries and territories. Its properties include hotels operated and franchised under the Marriott, Ritz-Carlton, Courtyard, Fairfield Inn, Residence Inn, TownePlace Suites and Executive Residences brands.
It also has vacation ownership resorts; food service and facilities management for clients in business, education and health care; senior citizen communities and services; and food service distribution.
It has some 192,000 employees and reported sales of $10.2 billion for fiscal 1996.