AT the recent Hong Kong Investment Conference Asia-Pacific (HICAP), the biggest bane of hoteliers’ existence clearly was Airbnb, but the most irresistible speculation was still who would buy Starwood Hotels & Resorts Worldwide.
Our grapevine puts Wanda Hotel Group as one of the latest suitors. Interestingly however, Wanda wasn’t in the list of three Chinese companies that The Wall Street Journal reported yesterday as competing to win government approval to bid for the US chain.
According to The Journal’s sources, Shanghai Jin Jiang International Hotels, HNA Group, parent of Hainan Airlines, and sovereign wealth fund China Investment Corp had presented proposals to the Chinese government over the past two months, and a decision was expected within a few weeks.
The Chinese government apparently wants only one domestic company to make a bid so that Chinese companies don’t drive up the price by bidding against one another. Makes sense (unless you’re dead against government playing big brother to the private sector) considering Starwood’s current market value is estimated by pundits to be about US$12 billion and any serious buyer is likely to have to fork out more than that.
Wanda though, could well be in the running. May we remind you that in as early as September 2013, Wanda’s owner Wang Jianlin, China’s richest man, in an interview with Bloomberg News at the World Economic Forum in Dalian, home base of Wanda, said he had hired two investment banks to buy hotel management companies. He added that he wanted to build five-star hotels at a rate of 15 per year. Sounds like Starwood is a good match for Wang’s aspirations.
“Wanda is looking at hotels as this is an important business, and hotels are the biggest luxury item globally, even bigger and more expensive than yachts and planes,” he was quoted as saying.
