Steve Bollenbach, the co-chairman and chief executive of U.S.-based Hilton Hotels Corp., has dashed hopes of an imminent merger with Hilton Group PLC, which operates the brand outside the U.S., the Financial Times reports in an article on its Web site Thursday.
He told the paper it was “hard to see the need for a deal that compensated for all the difficulties one would create.”
Bollenbach told the FT he didn’t envisage a merger or takeover until after he retired in December 2007.
“I think the right word is ‘inevitable,’ but it may be a long time coming because we do such a good job of working together now,” he told the paper. “The real impediment is that U.K. shareholders don’t want to own stock in a U.S. company, which makes it very difficult to see how we could combine the companies. They are too big for us to buy and we’re too big for them to buy.”
However, he didn’t rule out a deal in the future, the FT said. “Some day there will be a market mistake, where one company will trade too low relative to its market value and there will be executives smart enough to know that is what is happening.”
David Michels, chief executive of Hilton Group, agreed, the FT said. “We both appear to be selling down assets and a different landscape may well enable what both markets want, but neither are prepared to pay for.”