Westin Reported To Be For Sale

Westin Hotels & Resorts suddenly seems to be in play, with Starwood Lodging and Marriott International emerging as the most serious contenders for the chain.

While other hotel owners reportedly have expressed interest--including ITT Sheraton, Bass Plc. (parent of Holiday Inn) TRT (parent of Omni) and several real-estate investment trusts--many may just want to get access to Westin's files, one analyst said.

Analysts agree that the 100-property Westin chain, bought by a group of investors lead by Starwood Capital and Goldman Sachs in '95, could opt instead to go public.

Westin officials declined to comment, but observers agreed that the time is right for Westin to make some kind of move.

"Prices are high now, and it's a good time to sell," said Stephen Rushmore, president of Hospitality Valuation Services in Mineola, N.Y. Westin's owners "are seeing that they really can't compete with the REITs in acquiring properties," he said.

Phoenix-based Starwood Lodging Trust, the nation's largest public REIT, "certainly has made it known that they are in the market for a brand," said Arthur Adler, partner, hospitality consulting for Coopers & Lybrand. Starwood, which currently owns 100 hotels, declined to comment.

As to why Marriott might want to buy Westin on the heels of its $947 million Renaissance acquisition, "there are times when you buy something because you want it, and there are times when you buy something so that no one else buys it," one analyst said, adding that Marriott typically looks at every hotel company for sale.

"Having bought Renaissance fulfills a lot of our needs in many ways, but that doesn't preclude us from looking at other opportunities," Marriott International chairman and chief executive Bill Marriott told reporters on March 7.

"We have not basically grown by acquisition," Marriott said. "Renaissance is the biggest acquisition we've ever made, and only the second acquisition we've ever made [after Residence Inn]. By and large, we've grown one brick at a time." (Marriott acquired only 49 percent of the Ritz-Carlton Hotel Company.)

ITT Sheraton, which declined to comment, might buy Westin as a strategy to fend off Hilton's hostile advances, one analyst said. Should the capital markets not like the idea of a Sheraton-Westin merger, however, ITT stock prices could fall, "and all of a sudden Hilton's $55 offer looks better," another analyst said.