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Posted 07 May 2001   For week ended May 04, 2001
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Sent on Mormon-News: 05May01

By Kent Larsen

Marriott Abandons Bid for Le Meridien in Final Round

WASHINGTON, DC -- Marriott, International, the giant hotel chain run by LDS Church member J. Willard "Bill" Marriott Jr., dropped its bid for the Le Meridien chain of luxury hotels after it wasn't named the preferred bidder in the final round. The auction of the 150-hotel chain was part of the auction of the hotel properties of Compass Group PLC, in what has been called the world's largest hotel auction. Marriott had been expected to win Le Meridien, and dropping its bid led to the company's stock price to fall 5% yesterday.

Marriott has been involved in the bidding for Le Meridien since last Fall, as Mormon News has previously reported. Until the bids were announced earlier this week, Marriott was widely expected to win Le Meridien, seen by analysts as a platform that would allow Marriott to expand outside the US and into Europe. Currently Marriott's more than 2,300 hotels are primarily in the US.

Marriott's final bid was much lower than expected, apparently because of a weakening market for hotel rooms in the US. Marriott's bid of 1.7 billion pounds ($2.4 billion), was about 10% less than the competing bid, 1.85 billion pounds ($2.65 billion), from Nomura Securities. Nomura is a relative newcomer to hotels, having purchased its first chain just this past January. Analysts reacted negatively to Marriott's decision, "We think Marriott's stated goal of expanding in Europe may prove more difficult without the Meridien platform and could, generally, pose a risk to our longer-term growth estimates," ABN AMRO lodging analyst Joe Greff said in a research note about the acquisition.


Marriott says pulls out of Meridien talks
Reuters 3May01 B4

Nomura to win Meridien as Marriott passes
Reuters 3May01 B4

Marriott International Announces Withdrawal From Discussions to Acquire Le Meridien
PRNewswire 3May01 B4

See also:

Marriott in Auction Battle to Acquire Hotel Group


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