Loyalty plan key to Marriott-Starwood deal: CEO
Marriott International CEO Arne Sorenson said Friday he's pleased the hospitality giant prevailed in its quest to acquire Starwood Hotels & Resorts Worldwide, but he would have liked to have paid $1 billion less for the property.
Ending a heated bidding war, a consortium led by China's Anbang Insurance said Thursday it was walking away from its proposed takeover of Starwood, worth about $14 billion.
"They were real with their first bid … 10 or 11 percent higher than the [initial] deal we had on the table — fully financed, fully credible, [and] essentially no conditions," Sorenson told CNBC's "Squawk Box."
The original March 14 overture from the Anbang group forced Marriott to sweeten its November 2015 offer of $12.2 billion to $13.6 billion. In turn, Anbang upped its bid on March 26.
But less than a week later, Anbang reconsidered, saying "due to various market considerations, the consortium has determined not to proceed further."
"To be fair, it's worth more to us in some respects because we've got immediately $250 million of [overhead] cost synergies," Sorenson said. "That doesn't even get to what we can do on the revenue side."
As Marriott embarks on the takeover, Sorenson said: "The most important thing for us to succeed at is the loyalty program. You've got with SPG [Starwood Preferred Guest] and Marriott Rewards two big groups of very loyal customers."
The top concern from travelers when Marriott made its November bid was "what's happening with my points," he continued. "I think we can make sure the benefits stay the same or get better, but offer them a broader selection."
One of the complicating factors, he added, is the Marriott Rewards Visa card is tied to JPMorgan Chase, while the Starwood Preferred Guest card is offered through American Express.