Starwood baffles investors with “flamboyant and costly moves” under pressure to appoint new CEO
High-end accommodation umbrella Starwood Hotels & Resorts Worldwide has baffled investors with “flamboyant and costly moves” in the lead-up to appointing a new chief executive officer (CEO).
Now former global CEO Frits van Paasschen resigned by mutual agreement back in February and the company has yet to fill the role with a permanent replacement.
Shares in the $18 billion company jumped 3.9 per cent on March 26 when an undisclosed deal with stakeholder Senator Investment Group was cleared by the Federal Trade Commission.
accomnews asked Connor Campbell, a financial analyst from Spreadex, for his thoughts on the matter.
“Starwood Hotels appears to be taking the more is more approach at the moment, committing to 100 new properties in the next five years under its Tribute Portfolio banner. This, alongside an undisclosed deal with Senator Investment Group, which already owns a stake in the chain, suggests a company in robust health,” Mr Campbell, noted.
“However, Starwood is anything but, and with the noose tightening in regards to its increasingly unhappy activist shareholders as well as the still-vacant position of permanent CEO, these flamboyant and costly moves may not be the kind of market consolidation Starwood needs to get it back on track.
He continued: “Yet investors responded positively to the Senator Investment news, suggesting that for now these displays of intent, regardless of their actual worth, may be enough to satisfy those with an interest in the company.”
accomnews also reached out to Starwood for comment and will publish any updates as they are received.
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