This appears somewhat improbable to me, yet I believe it merits addressing the speculation, as I’ve had multiple individuals forward this to me…
Speculation regarding Marriott’s acquisition of Rosewood Hotels
A FlyerTalk participant has shared what is purportedly a leaked image of a document intended for the legal team, indicating that Marriott might be considering the acquisition of the luxury hotel collection Rosewood. Although it is merely a partial image, the text indicates that it “relates to a significant strategic acquisition endeavor” titled “Project Pegasus” that is “currently being developed by Marriott International.”
The memo further states that “the intent of this communication is to officially assign our team with the preparation and submission of all necessary legal documents to the U.S. Federal Trade Commission (FTC) and Department of Justice (DOJ) to obtain their approval ahead of the deadline of February 28.”
Allow me to stress that I cannot personally guarantee the validity of this. The wording is certainly peculiar, but then again, this is an international transaction, so it’s uncertain which legal team is overseeing this.
For those unaware, Rosewood is a rapidly expanding ultra-luxury hotel group, currently boasting around 40 properties, with a comparable number of hotels and resorts in the works. The brand is known for its stunning properties and is arguably most directly a rival to Four Seasons (with properties generally exhibiting a greater sense of place, on average).
Rosewood is owned by Hong Kong-based New World Development (NWD), a property conglomerate spearheaded by the Cheng family. Rosewood primarily acts as an investor in its properties, distinguishing it from a typical hotel group with an asset-light strategy (unlike the majority of major global hotel chains).
NWD has recently faced liquidity challenges, and a few weeks ago, there were rumors about Rosewood potentially offloading some assets, though not the Rosewood brand as a whole. Naturally, as a property giant, circumstances can shift rapidly, and I suspect if the price is appropriate, it will at least be taken into consideration.
It is worth noting that Rosewood CEO Sonia Cheng is extremely passionate about the hotel group, and I can’t envision her being pleased about this, as she has invested years in transforming Rosewood into what it is today. For her, this is undoubtedly a company she cherishes. Who knows, perhaps part of the arrangement would entail her remaining and leading the brand under Marriott (though I doubt she would find it as rewarding).
This would represent a significant development for both brands
Marriott follows an asset-light strategy, so if Marriott were to procure Rosewood, it would likely aim to quickly divest the properties, as this acquisition would be focused on integrating Rosewood properties into Marriott’s portfolio. This is somewhat akin to Hyatt’s recent acquisition of Playa, which also owned numerous properties, as Hyatt acquired the company and then proceeded to sell the properties.
There’s no denying that incorporating an ultra-luxury hotel collection into one of the leading global hotel groups would constitute a significant advantage for that hotel group, enhancing loyalty revenue. It remains uncertain whether the properties would be part of Marriott Bonvoy, and if they were, to what degree.
While I generally appreciate the prospect of increased opportunities to earn and redeem points at luxury hotels, Marriott consistently demonstrates a lack of genuine concern for guest experience, leaving me disheartened by this possibility, as it would likely result in a notable decline in the quality of Rosewood’s portfolio.
Rosewood has excelled in genuinely investing in guest experience, and it’s undeniable that a Ritz-Carlton effect would emerge if Marriott assumed control (and that’s unfavorable).
So, if Rosewood were to be acquired, may I modestly recommend that Hyatt at least consider making an offer as well, as I believe that would better preserve the quality of these hotels? Hyatt has been heavily focused on all-inclusives, and I would appreciate seeing more attention given to authentic luxury properties.
Bottom line
A rumor indicates that Marriott may be considering the acquisition of luxury hotel group Rosewood. This is based on an alleged leaked document suggesting that the legal team is preparing for this. Furthermore, we know that the owners of Rosewood have been facing some liquidity challenges.