Starwood Hotels & Resorts Worldwide Inc.: Asia Pacific

By Leong Choon Chiang & D. G. Allampalli

Abstract

The case describes how Starwood Hotels and Resorts Worldwide Inc., founded in 1991, grew under the visionary leadership of Barry Sternlicht, its founder and CEO. It documents how Sternlicht acquired, financed and integrated two leading hotel brands - Westin and ITT Sheraton to become a globally diversified leading hotel chain. However, by the time the integration process was almost completed, Starwood's operations were severely impacted by the September 11 terrorist attacks and weaknesses in the global economy. When business and leisure travel in North American and European markets entered a downturn, its growth stifled. It leaned on Asia for future growth in the new millennium.

As the global hotel industry endured the impact of terrorism, the region's recovery prospects further deteriorated due to the 2002 Bali bomb explosions and early 2003 Iraq war. Amidst many challenges for the company's newly appointed president of Asia Pacific, boosting the share of operating profit from 10 to 25 percent by 2007 - a goal set by the CEO in 2002, was a tough act on hand.

Issues: Merger and Acquisition in the Hotel industry, Entrepreneurship and Strategic Planning

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