Hilton Seeks To Reunite U.S., International Brands

<H1>Hilton Seeks To Reunite U.S., International Brands</H1><H3>By Linda Humphrey</H3><I>Beverly Hills, Calif. </I>- An alliance between Hilton and Hilton International seems imminent as Hilton chief executive Stephen Bollenbach recently told reporters he "hopes a deal can be reached in the next few months."

In a news conference following the chain's May 9 annual meeting, Bollenbach said a merger "is possible with the hotel part of the business but not with the entire Ladbroke, which includes their gaming business."

Peter George, chief executive of Britain's Ladbroke Group-which has owned the Hilton name outside the United States since 1987-told London's Financial Times last week the two are discussing "a range of ways of reuniting the Hilton brand. Steve seems to share my view that something can and should be done."

The outcome will range from "a cooperative marketing arrangement to a full merger of the two firms," said Bjorn Hanson, hospitality industry chairman for Coopers & Lybrand.

The relationship, Hanson said, "probably won't be as limited as just a marketing alliance." A full merger, however, will not be announced in the next week or so, Hanson predicted. "One possibility is that each company will invest in the other but not merge," he said. "Another is a schedule of smaller transactions that over time would lead to the two companies merging."

A merger would "take what arguably is the best name in the hotel business, Hilton, and make it an international powerhouse as opposed to two companies now both handicapped by the inability to be global and international," Hanson said.

Even though most travel managers negotiate with individual hotels, an alliance between Hilton and Ladbroke could only benefit corporate buyers, said consultant Ralph Brown, president of R.D. Brown Co. in Hoffman Estates, Ill. "There would be less people to communicate with and a better opportunity to deal at a corporate level," he said.

A merged Hilton would be a boon to multinational companies such as Philips Electronics Corp., which counts both chains among its preferred vendors. "With that in mind and considering that we're an international company, a merger could be extremely beneficial," said Bob Brunner, Philip's manager of corporate travel.

As one of the first corporations to sign on when Hilton first came out with a national program in the late '80s, "we've had a very, very good relationship ever since," Brunner said.

"Hilton International is in the locations we need," Brunner said, adding that the Conrads "are lovely properties, but they're not located geographically where we have very much need for them. If they were in the right places, we'd probably use them."

An alliance would most likely erase the Conrad and Vista names, Hanson said, although the Conrad label might be "used in a different context within a combined Hilton International organization.