Global Spending

Hotel Industry Upended Again

Just as the Marriott-Starwood merger is beginning to settle in the minds of the hotel industry, Carlson has announced that it is splitting is hotel-management operations from its enterprise travel-management business. The firm operates the Radisson and other brands worldwide, with exposure to some 110 countries. While better known to the public for its hotel properties, the other side of the business—heavily geared toward serving large corporations—is over three times more profitable for the company.

Shifts within the industry have pulled Carlson in two different directions. The ascent of online booking means that Carlson runs the risk of seeing its revenue-rich enterprise travel-management business erode without concerted focus. Meanwhile, the rise of the mega-chain places ever-greater capital demands on the firm. Investors have long been skeptical of diversified travel companies, likely hindering Carlson’s ability to raise capital for its hotel efforts in the institutional market.

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Image: The front desk is the face of a hotel. Credit: Deklofenak at Can Stock Photo.

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