The European Commission has this week approved the acquisition of Starwood Hotels & Resorts by rival Marriott. The deal was waved through by the commission who said "the takeover would not adversely affect competition in Europe".
Commissioner for Competition, Margaret Vestager, said, "This is an important merger for the hotel industry and its customers. Our investigation confirmed that the hotel sector will remain competitive for customers in Europe following the merger, so I am pleased that the Commission was able to clear the transaction quickly".
Marriott operates more than 4.500 hotels in 85 countries while Starwood operates around 1,300 hotels in almost 100 countries.
Travel management company Carlson Wagonlit has issued a white paper looking at the consolidation in the market brought about by the deal
Scott Brennan, CWT's head of global supplier management, said, "Consolidation in the hotel industry isn't new but the Marriott/Starwood tie-up is likely to change the way corporate travel is bought and sold. Everyone has to think very carefully about what this means for negotiating corporate travel deals."
Our chart this week comes from the white paper and shows the share of spend of the two groups in key business destinations around the world. Buyers will be concerned in those markets where the combined group will have more than a third of the corporate market.
Brennan said, "The implications are potentially huge. We think the new Marriott/Starwood group is going to have a lot of say in the market, which could alter the way corporate rooms are bought and sold. We don't yet know the full impact and because the new group won't be finalised in time for the negotiations this year, we won't know until the 2017 negotiating season, in September next year."
The CWT analysis also shows that 22% of non-compliant spend is with Marriott and 9% with Starwood.