Marriott’s merger with Starwood is being challenged by hotel owners in New York and Chicago who say the combination would violate their exclusivity agreements with Starwood. Owners of the Westin Times Square and Sheraton Grand Chicago filed suit Tuesday, arguing the merger would unfairly eat into their business. They are seeking to block Marriott from taking the final steps required for purchasing Starwood. According to Bloomberg:
The plaintiffs say the deal would violate contract clauses that prohibit Starwood from owning, franchising, operating or managing other hotels within a specific geographical area around the two hotels.
Both Marriott and Starwood declined to comment.
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1 comment
Interesting, although my guess is that Marriott will hand them a bag of cash as settlement and the merger will continue. The biggest issue will be if other operators sign on to this – it could become a problem that throwing money at won’t easily fix.