Though each group will be operated by separate management teams led by a chief executive officer, the gaming and hotel operations will share purchasing and marketing synergies created by the scale of the entity.
"Today's announcement is a major step in the integration of ITT, Westin and Starwood, which now constitute the new Starwood Worldwide," said Barry S. Sternlicht, chairman of the board of directors of Starwood Hotels Resorts Worldwide.
"Upon completion of the Westin and ITT acquisitions, Starwood Hotels Resorts Worldwide became a global force in the hospitality and gaming industry. The best talent from each of the three organizations is reflected in the new structure, which will allow Starwood Worldwide to effectively focus on its core hotel and gaming operations and maximize the efficiencies of its significant scale in operations, marketing and purchasing.
"The goal was to refine and maintain brand integrity while putting in place the most streamlined operating organization that would be motivated to cross-sell and enhance revenue while driving the cost of operations lower for the benefit of all owners and as a major owner ourselves, our shareholders."
Starwood Hotels Resorts Worldwide - Hotel Group
The Hotel Group will consist of worldwide operating divisions which include North and Latin America, Europe, Middle East/Africa and the Asia-Pacific region and will be led by Juergen Bartels as chief executive officer.
Each operating division will be headed by a president, five of whom are from the Sheraton organization, who will oversee the operational and financial performance for all hotel properties and brands within his division. Fred Kleisner will become president and chief operating officer, the Americas.
Reporting directly Kleisner will be Ted Darnall and Hud Hinton with responsibility for North American hotel operations. Reporting to Darnall and Hinton will be 10 regional operators, two from the former Starwood Worldwide, three from Westin and four from Sheraton. The remaining position will be filled shortly.
Starwood Hotels Resorts Worldwide - Gaming Group
Starwood Worldwide also announced that Peter Boynton, chief executive officer of Caesars World Inc., will also become chairman of Caesars World and will lead the Gaming Group. Boynton will have worldwide responsibility for all Caesars operations, including its world-famous Atlantic City, N.J., and Las Vegas properties.
"This new structure is intended to ensure operational excellence as
the company expands its portfolio, brands and profitability, both domestically
and internationally," continued Sternlicht. "Under this dynamic team's
leadership, we expect that all the properties within the company's combined
portfolios will prosper and produce excellent results."
|Juergen Bartels, chief executive officer|
|Daniel Weadock, special assistant to the chairman|
|Fred Kleisner, president and chief operating officer, the Americas|
|Ted W. Darnall, executive vice president, Hotel Operations, North America|
|Hud Hinton, executive vice president, Hotel Operations, North America|
|Osvaldo Librizzi, president, Latin America|
|Robert F. Cotter, president and chief operating officer, Europe|
|Sami Zoghbi, president, Africa and Middle East|
|Ted Teng, president, North Asia|
|Edward Davie, president, South Pacific|
|Sam Winterbottom, president, Franchise Division|
"With so many talented individuals and exceptional assets in each of the three companies, we have assembled the strongest leaders from each to form an experienced, focused management team which will collectively lead the Corporation's operations going forward," continued Sternlicht.
"These individuals are recognized industry leaders; each brings demonstrated leadership skills as well as global hospitality knowledge and expertise to their newly created positions.
"By combining their management talent and best practices, Starwood Worldwide expects to capitalize on their respective strengths in an effort to significantly enhance the company's operational and financial performance and further solidify Starwood Worldwide's position as one of the premier hotel companies in the world."
Juergen Bartels - Chief Executive Officer
As the chief executive officer for the Hotel Group, Bartels, 57, will have worldwide responsibility for the operating and financial performance of the 650 properties and products that operate under the Starwood umbrella, including such well known brands as the St. Regis (Luxury Collection), Westin, Ciga, Sheraton, Four Points and several independent hotels.
Bartels is a respected international leader with four decades of hotel industry experience and has held top management positions with major hotel companies in Europe, Canada and the United States. His extensive experience in running large, upscale hotel companies, proven leadership skills and dedication make him well suited to lead the hotel operating group.
Bartels joined Westin Hotels Resorts in 1995 as chairman and chief executive officer where he led the effort to reposition the company and expand its brand image on a global basis.
In January 1998, Westin Hotels Resorts was acquired by Starwood Hotels Resorts, and at that time Westin's portfolio included more than 100 hotels and resorts, with approximately 41,000 rooms in 23 countries, and combined annual systemwide revenues of more than $2.4 billion.
Under Bartels' leadership, Westin's operating margins increased from
28 percent to 38 percent while the company added 65 hotels to its portfolio,
26 of which are currently under development. Despite this
extraordinary growth, Westin maintained its upscale brand integrity and in 1997 was ranked No. 1 in the first ever J.D. Power Associates quality survey of upscale hotel chains.
Prior to joining Westin, Bartels served as president and CEO of Carlson Hospitality Group Inc. where he provided strategic direction for Carlson's Radisson Hotels International, Radisson Seven Seas Cruises, and several major restaurant companies including T.G.I. Friday's chain which comprised $3.4 billion of the company's 1994 revenues.
Carlson's portfolio increased from 20 hotels to 354 hotels during Bartels' 12 year tenure at the company.
Daniel P. Weadock - Special Assistant to the Chairman
In his new role, Weadock, 58, will help speed the integration process
of the three companies focusing on
communication and coordination. He will act as the Corporation's key intermediary of the Starwood brands on a global basis, communicating with both owners, key foreign officials and with investors.
"We are incredibly grateful to Dan Weadock for his strength, commitment and his integrity in helping this integration process proceed and we are counting on Dan to continue to aid in this ongoing process," said Sternlicht.
With more than 37 years of experience with both ITT and Sheraton Corp., Weadock brings a thorough understanding and knowledge of that company's brand and organizational strength to Starwood. Weadock was formerly senior vice president, ITT Corp., and president and CEO of ITT Sheraton Corp.
The company grew five fold in the last five years. While at ITT and Sheraton, he served in several divisions including president of the ITT Africa and Middle East Group, president of ITT Europe, and chairman, president and chief executive of ITT Communications and Information Services (ITT COINS). He was named president and CEO of ITT Sheraton in 1995.
Fred Kleisner - President and Chief Operating Officer, the Americas
Kleisner, 53, will direct the largest region within the Hotel Group, the Americas.
Formerly president and chief operating officer of Westin, Kleisner has been directing global operations for Westin's more than 100 hotels in 23 countries since 1995. His efforts at Westin played a key role in the company's dramatic financial and operational growth as well as its global expansion.
Prior to Westin, Kleisner served as group president of operations for Interstate Hotels Corp., directing the operations of Interstate's core brands, Crossroads Hospitality and Colony Hotels and Resorts. Prior to Interstate, Kleisner served as senior vice president of Sheraton's North America Division/East. Kleisner began his hotel career with Hilton Hotels, where he served for 16 years in various hotel management capacities.
Ted W. Darnall - Executive Vice President, Hotel Operations, North America
Darnall, 40, brings to this new management team in-depth knowledge and expertise drawn from being affiliated with organizations that are both owners and operators of hotels.
He joined Starwood Hotels Resorts Worldwide in 1996 as chief operating officer and has been responsible for the operational and financial performance for the company's portfolio of owned, managed and franchised hotels, which at the end of 1997 represented more than 100 hotels operating under 21 different brands, and 26 independent properties.
Under Darnall's leadership, the Corporation's gross operating margins increased by more than 15 percent while assuming management of an average of 3 hotels per month, excluding the Westin and ITT transactions, since he joined Starwood in April 1996.
Prior to joining Starwood Lodging, Darnall was with Interstate Hotels for more than 14 years where he held a variety of management positions, and in 1995 was named senior vice president of operations.
Hud Hinton - Executive Vice President, Hotel Operations, North America
Hinton, 44, will share responsibility with Darnall for hotel operations across all brands in North America.
In his former position as senior vice president of Westin, Hinton had responsibility for the financial and operating performance of more than 60 hotels in Westin's portfolio in North America.
Prior to being named a senior vice president, Hinton served with Westin for more than 25 years in various hotel and corporate positions, including general manager of such noted hotels as the Plaza in New York and the Arizona Biltmore in Phoenix.
Robert F. Cotter - President and Chief Operating Officer, Europe
A 25-year veteran of ITT Sheraton and formerly senior vice president/ITT
Sheraton and president, Europe
Division, Cotter, 46, will continue to reside in Brussels, Belgium, in his new role with the hotel operating group.
He will directly oversee operations, sales and marketing for 80 hotels and resorts in 19 countries in Europe, including Ciga Hotels, and he will assume responsibility for Westin's European hotel operations.
Cotter has driven exceptional results from some of the most extraordinary hotels in the world, such as the Danieli, Gritti Palace, Pitrizza, Cala di Volpe and Excelsior in Rome. He has also played an integral part in expanding Sheraton's presence in the European sector.
During his tenure at ITT, Cotter served in various capacities, including senior vice president and president of ITT Sheraton's Asia-Pacific Division, numerous sales and marketing positions, including director of sales; area director of marketing, product management and director of hotel marketing.
Osvaldo Librizzi - President, Latin America
Librizzi, 49, will direct all hotel operations for the Hotel Group's properties in Latin America, including hotels in Mexico and Central and South America. Librizzi will continue to be based in Buenos Aires, Argentina.
Formerly, Librizzi served as senior vice president, ITT Sheraton and
president, Latin America Division, where he oversaw the company's 18 Latin
American properties, located in Mexico, Argentina, Brazil,
Chile, Peru and Venezuela.
Librizzi has done extraordinary work expanding Sheraton's already outstanding position in South America, which region now boasts among the highest operating margins in the company. Additionally, Librizzi will assume direct responsibility for Westin's six hotels in Mexico.
An ITT Sheraton executive in the Latin America Division since 1975, Librizzi also served in a variety of executive capacities, including senior vice president and director of operations for the division, senior vice president and area manager for South America, and general manager of the Sheraton Buenos Aires Hotel Towers.
Sami Zoghbi - President, Africa and Middle East.
Zoghbi, 60, will direct the operations of 32 hotels in 18 countries that constitute the African and Middle Eastern region of the world. He will remain headquartered in Cairo, Egypt. Zoghbi has been primarily responsible for Sheraton's extraordinary distribution in a very important but substantially undeveloped part of the world.
Zoghbi has more than 24 years of experience with ITT Sheraton's African and Middle East division. His strong international experience and vast knowledge of these markets makes Zoghbi a very valuable addition to the management team.
Since 1994, Zoghbi served as senior vice president, ITT Sheraton and
president of the company's Africa and Middle East Division. In this role,
he was responsible for the operations, development, sales
and marketing of 32 hotels and resorts in 18 countries in Africa and the Middle East.
Zoghbi began his career at ITT Sheraton in 1974 as general manager of the Cairo Sheraton Hotel in Egypt and has moved up through the division to the position of executive vice president, Sheraton Management Corp., regional director of operations, Middle East.
Prior to his career with ITT Corp., Zoghbi held various managerial positions with both Trust House Forte and Inter-Continental Hotels.
Ted Teng - President, North Asia
Based in Singapore, Teng, 42, will supervise all hotel operations in China, Korea and Japan.
Teng brings to Starwood Worldwide a unique blend of experience from
both ITT Sheraton and Westin that is expected to greatly benefit the Corporation's
operations. He is fluent in several languages,
familiar with the diverse cultures and varying business practices in the region.
Formerly executive vice president and president, Asia Pacific Division for Westin, Teng, has directed all of its Asian operations since 1996.
Previously, he was with ITT Sheraton, where he held a variety of managerial positions including vice president and director of Operations Support/Asia-Pacific Division and vice president and division controller/Hawaii-Japan Division. His final position with the company was as vice president and director of operations/Asia.
Edward Davie - President, South Pacific
Davie will have operational area of responsibility for hotels and resorts in the South Pacific, including Australia and New Zealand.
Formerly senior vice president, ITT Sheraton, and president, Asia-Pacific
Division, he has been overseeing 47 properties. He joined ITT Sheraton
in 1985 in New Zealand before moving to the Asia Pacific
Divisional Office in Hong Kong. He held various positions there until being named president in 1994.
Sam Winterbottom - President, Franchise Division
Winterbottom, 50, moves up from president, ITT Sheraton Franchise Division, to president, Franchise Division of the Hotel Group. In his new role, he will direct franchising and hotel operations for more than 225 franchised hotels in the United States and Canada, including Westin Hotels. He brings more than 25 years of hospitality and franchising experience to his new position.
Winterbottom formerly served as president, Franchise Division, of ITT Sheraton, where he was responsible for the worldwide franchise development for Four Points Hotels, as well as franchise development in North America for Sheraton Hotels Resorts.
He was also responsible for the overall franchise operations and relations,
hotel standards, quality assurance, and sales and marketing and development
for ITT's nearly 200 franchised Sheraton Hotels
Resorts, Four Points Hotels and Sheraton Inns, representing nearly 50,000 guest rooms. Prior to joining ITT Sheraton, Winterbottom served as regional president of Franchise Operations for Ramada Inc.
He also held various franchise sales and management positions with Howard Johnson Hotels, Harley Hotels and Freedom Financial Corp.
Corporation to Relocate to Westchester/Fairfield County
The Corporation Monday also announced plans to relocate its corporate
headquarters to the Westchester
County, New York/Fairfield County, Conn., area. As part of this move, most of the operating and staff functions currently headquartered in New York, Boston, Atlanta, Phoenix and Seattle will be consolidated and relocated to the new corporate offices.
The accounting and treasury functions will be combined and relocated to Phoenix, under the leadership of Ronald C. Brown, chief financial officer of Starwood Worldwide. The Gaming Group will remain headquartered in Las Vegas.
The Corporation will maintain satellite offices in Seattle, Boston and Atlanta locations. The consolidation and relocation plan is expected to result in the realization of a significant portion of the synergies anticipated from the acquisitions of ITT and Westin Hotels Resorts.
Sternlicht added, "Initiatives are also well underway in integrating central reservation systems, franchise operations, central sales offices, frequent guest programs, call centers, purchasing, employee compensation and benefits, rebranding of Starwood-owned hotels, complexing (operating multiple hotels in a city using one back office), financial reporting and design-construction."
Starwood Worldwide, through its ITT Sheraton, Westin and Caesars subsidiaries, is one of the leading hotel and gaming operating companies in the world. Starwood Hotels Resorts is the largest real estate investment trust in the United States. Shares of Starwood Hotels Resorts Worldwide are paired and trade together with shares of Starwood Hotels Resorts (NYSE:HOT).
Note: Statements in this news release which are not historical may be deemed forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Although Starwood Hotels Resorts believes the expectations reflected in any forward-looking statements are based on reasonable assumptions, it can give no assurance that its expectations will be attained. Factors that could cause actual results to differ materially from Starwood Worldwide and Starwood Hotels Resorts' expectations include legislative proposals to limit activities of paired-share real estate investment trusts, completion of pending acquisitions, continued availability of acquisitions, continued availability of debt and equity on favorable terms, foreign exchange fluctuations, performance of hotel operations, financial performance, real estate conditions, market valuations of its stock, execution of hotel renovation programs, changes in local or national economic conditions and other risks detailed from time to time in the Starwood Worldwide and Starwood Hotels Resorts SEC reports, including quarterly reports on Form 10-Q, reports on Form 8-K and annual reports on Form 10-K.