This seems somewhat unlikely to me, but I think it’s at least worth addressing the rumors, as I’ve now had several people forward this to me…
In this post:
Rumors of Marriott acquiring Rosewood Hotels
A FlyerTalk user shares what’s allegedly a leaked screenshot of a document for the legal team, which suggests that Marriott may be looking to acquire luxury hotel group Rosewood. While it’s only a partial screenshot, the text states that it “pertains to a critical strategic acquisition initiative” named “Project Pegasus” that’s “currently under development by Marriott International.”
The note continues that “the purpose of this communication is to formally task our team with the preparation and submission of all required legal documents to the U.S. Federal Trade Commission (FTC) and Department of Justice (DOJ) to secure their approval prior to the deadline of February 28.”
Let me emphasize that I can’t personally vouch for the accuracy of this. The language is definitely strange, but then again, this is an international transaction, so who knows exactly which legal time is working on this.
For those not familiar, Rosewood is a fast growing ultra-luxury hotel group, which currently has around 40 properties, and a similar number of hotels and resorts in the pipeline. The brand has some spectacular properties, and is probably most directly a competitor to Four Seasons (with properties generally having a little more sense of place, on average).
Rosewood is owned by Hong Kong-based Chow Tai Fook Enterprises (CTFE). The company also largely invests in its properties, so it’s not simply a hotel group with an asset light strategy (unlike most of the major global hotel groups).
Some Rosewood properties are owned by New World Development (NWD), a subsidiary of CTFE. NWD has reportedly been dealing with liquidity issues in recent times, and a few weeks back there was talk of how the company may be looking to unload some of its Rosewood assets, though there was no talk of the Rosewood brand overall being sold. Of course I imagine if the price is right, it’s at least something that’s going to be considered.
One thing worth mentioning is that Rosewood CEO Sonia Cheng is incredibly passionate about the hotel group, and I can’t imagine she’d be very happy about this, because she has dedicated years to making Rosewood to what it has become. For her, it’s clearly a company she loves. Who knows, maybe part of the deal is that she stays on and runs the brand under Marriott (though I can’t imagine she’d find it as fulfilling).
This would be a major development for both brands
Marriott has an asset light strategy, so presumably if Marriott were to acquire Rosewood, it would almost immediately try to unload the properties, as this deal would be about adding Rosewood properties to Marriott’s portfolio. This isn’t that different than Hyatt’s recent acquisition of Playa, which also owned many properties, as Hyatt bought the company, and then turned around and sold the properties.
There’s no denying that adding an ultra-luxury hotel collection to one of the major global hotel groups would be a major win for that hotel group, and would help with loyalty revenue. It’s anyone’s guess if the properties would participate in Marriott Bonvoy, and if so, to what extent.
While I generally love the idea of more opportunities to earn and redeem points for luxury hotels, Marriott is simply so bad at actually caring about guest experience, and I can’t help but be sad at the prospect of this, as it would almost certainly lead to a great reduction in quality of Rosewood’s portfolio.
Rosewood has done a fantastic job actually investing in guest experience, and there’s no denying that there would be a Ritz-Carlton effect if Marriott had control (and that’s not a good thing).
So I guess if Rosewood were to be acquired, can I humbly suggest that Hyatt at least make an offer as well, as I think that would do more to preserve the quality of these hotels? Hyatt has been going so heavy on all-inclusives, and I’d love to see some more focus on true luxury properties.
Bottom line
A rumor suggests that Marriott may be looking to acquire luxury hotel group Rosewood. This is based on an alleged leaked document that suggests the legal team is preparing for this. On top of that, we know that the company that owns some Rosewood properties has been dealing with liquidity issues.
It’s anyone’s guess if this is all true, and if so, if this will actually go through. Rosewood’s owners insisted several weeks back that they were looking to possibly unload some properties, but not sell the brand overall.
Rosewood has done an incredible job growing with some special properties, and as much as I like the idea of being able to earn and redeem points at these hotels, I can’t imagine they would be anywhere close to as good if they were managed by Marriott. So we’ll mark this as “developing” for now…
What do you make of this Marriott & Rosewood rumor?
Marriott seemingly just wants to buy things with "wood" in the name... first Starwood, now Rosewood ;)
Look, I actually used to do this sort of thing (among other similar stuff). So trust me when I say this doesn't makes sense -- at all.
What the document is referred to is an HSR filing with Justice/FTC. That's something 100 % handled by corporate lawyers. They're the ones who send out requests for information, detailed information, channeled through (in my experience) the CFO. This weir memo, on the other hand, is just a...
Look, I actually used to do this sort of thing (among other similar stuff). So trust me when I say this doesn't makes sense -- at all.
What the document is referred to is an HSR filing with Justice/FTC. That's something 100 % handled by corporate lawyers. They're the ones who send out requests for information, detailed information, channeled through (in my experience) the CFO. This weir memo, on the other hand, is just a bunch of strange marketing-speak put together by someone who doesn't know how mergers work. Also, HSR stuff doesn't come along until the business negotiations are fairly well along.
So, you other M&A guys out there, anything to add?
Fun fact : CTF group used to have an unhappy business relationship with Trump!
Like most, I’d be thrilled if Hyatt was able to make this purchase. Baha Mar stars in many of my family’s most joyous memories. However, I recently stayed at Kona Village and felt the service was amateurish. I don’t know if that’s a result of money troubles, or not.
Rosewood is not owned by New World Development (NWD). It is owned by CTF Enterprises, which also own NWD. And CTF Enterprises is in a decent financial shape, unlike NWD
Oh great. Another brand ruined by Marriott. If Hyatt were smart, it would step in and buy it. Hyatt needs more hotels. The more natural fit for Rosewood, however, is probably Four Seasons or even Peninsula.
Lord help us if Marriott buys another world class brand. One can hope that the FTC might push back on all the industry consolidation
No chance of that unless Trump gets angry at Marriott.
Agree - would love to see Hyatt step up and buy 'em
I sure hope not. Rosewood in BVI and AMS are both excellent. Nassau, not so much.
The Rosewood Bermuda was very mid. I suppose every brand has its duds.
St. Regis there is alright.
RIP Rosewood.. they just got bonvoyed
What an awful prospect. The world has enough shitty Ritz-Carltons - each one a blot on Cesar Ritz’ memory
Whilst I agree with you about the Ritzes being a blot on César Ritz‘s legacy, how does that attach to Rosewood? (Honest question btw, not a flame)
*Ritz-Carltons*, not Ritzes.
Time for Marriott to ruin another great luxury hotel brand
The Renaissance brand was sold by CTF to Marriott 30 years ago. Rosewood was what CTF had after they sold Renaissance. Looking at it this way, there is nothing strange about it.
What happened to Renaissance makes me especially sad.
Oh I hope not. There are few companies, brands, and properties more soulless and quintessentially devoid of any character, charm, or warmth than a Marriott. Just cold, money-obsessed values reign supreme.
I miss Caro Hunt.
Am I living in the past?
You betcha’ I am!
I say no.
The taint of Marriott on the Rosewood brand would sap the acquired asset (Rosewood) of a substantial amount of its value. no one should trust Rosewood under Marriott's stewardship. A luxury conglomerate like LVMH would be a more logicial buyer,
Remember the Bonvoy business model- The hotel is the customer, and you, the paying guest, are the product, to be "Bonvoyed" at a time and place of their choosing.
I vote yes.