Hyatt CEO mum on Starwood rumors
 
Hyatt CEO mum on Starwood rumors
04 NOVEMBER 2015 9:43 AM
Hyatt CEO Mark Hoplamazian held his cards close to the vest when discussing the company’s rumored interest in acquiring competitor Starwood Hotels & Resorts Worldwide. 
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CHICAGO—Hyatt Hotels Corporation is one of the more recent suitors to be rumored in contention for a takeover bid of Starwood Hotels & Resorts Worldwide, but the company’s CEO kept any involvement close to the vest Tuesday during an earnings call with analysts, which was webcast. 
 
“There have been recent press reports speculating about our potential interest in a competitor,” said Mark Hoplamazian, Hyatt’s president and CEO, in his prepared remarks. “Consistent with our past practice, we do not comment on rumors or speculations, and this will be no exception. On this topic, we have no comment, and we won't be making further comments on this today.”
 
Analysts refrained from inquiring further about the subject during the question-and-answer portion of the earnings call. 
 
Hyatt is one of several interested parties, according to reports. Also in the mix is Jinjiang International Company Limited.
 
Hoplamazian did share some perspective on Hyatt’s strategy surrounding both acquisitions and dispositions. 
 
“We talked extensively over the last five years about asset recycling as a core part of our strategy in the context of expanding into key markets as we increase the productivity of the capital invested in our owned hotels,” he said. 
 
“This has worked extremely well for us, as we bought or sold nearly $5 billion of assets over the past five years. Given the very significant amount of activity in 2014, at the end of 2014 we decided to reduce the pace of recycling as we digested the changes in our portfolio and, since then, we've seen improved earnings at a number of our hotels that were in our consideration set for disposition. And at the same time, we've seen somewhat more limited acquisition opportunities in asset categories relevant to our program and our areas of focus,” Hoplamazian added. 
 
The CEO said he and his executive team are active in the evaluation of both acquisitions and dispositions “on an ongoing basis, and will remain so as we have in the past.” 
 
Shares of Hyatt (NYSE: H) were down 1.3% in the day’s trading. The Baird/STR Hotel Stock Index, by comparison, was flat. 
 
 
Parting with the Park Hyatt?
One analyst asked whether executives are looking to monetize the 210-room Park Hyatt New York, which the company acquired in August 2014 for approximately $390 million. 
 
“When we closed that transaction to buy the Park Hyatt New York, I was asked at that time whether this would be an asset that would be available for recycling,” Hoplamazian said. “My answer was, emphatically, ‘yes.’ … The whole purpose of doing the deal was to secure that location and, over time, if it makes sense to sell it, we should sell it. So that remains true.
 
“But, having said that, we're not actively marketing anything at this point,” he added. 
 
Executives have been approached about key assets in key locations, Hoplamazian said. Some of those dialogues are ongoing. 
 
“But, right now, we're not actually out marketing properties,” he added. 
 
The CFO search drags on
The hunt for Hyatt’s next CFO, which began when Gebhard Rainer vacated the post in September 2014 to become president and chief operating officer at handbag-maker Coach, continues to drag on. 
 
“Since the process began, we have been working with a major global search firm. We've interviewed a number of candidates, some of whom looked like a very good fit for us. We pursued these individuals, but for reasons relating to their existing positions and personal circumstances that evolved and changed during the time that we were in dialogue with them, they were ultimately unable to make a move,” Hoplamazian said. 
 
“We're still on discussions with candidates at this time, and we continue to be very encouraged by the quality of the candidates interested in Hyatt,” he said. 
 
Atish Shah continues to serve as interim CFO. 
 

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