Four Seasons CEO to Suitors: Thanks, But No Thanks
Photo Credit: J. Allen Smith, CEO of Four Seasons Hotels and Resorts speaking at Skift Global Forum. Skift
Skift Take
As a large independent hotel company with a distinctive luxury brand, Four Seasons is always going to be a takeover target but it sounds like it is more likely to be a buyer rather than a seller.
Bill Gates and Saudi businessman Prince al-Waleed bought Four Seasons for $3.8 billion back in 2007 and have sufficiently deep pockets to make Four Seasons a potential buyer but Smith, who will leave the company later this year, said any deals would have to be carefully thought through.
"We're unique. We're a single brand focused exclusively on luxury," he said. "We've remained very true to that. And for the time being, I expect we will continue too." Smith said buying another company was "not out of the realm of possibility" but that the company would have to it was "nothing that in any way dilutes the perception of our primary brand." Residential Luxury Four Seasons has been around since 1960 and currently has 110 hotels and resorts, and 39 residential properties in major city centers and resort destinations in 46 countries. The residential side of the business might be less well known but it is crucial for the hotel business, Smith said. "Residential is absolutely central to our business strategy. When I arrived at Four Seasons I would describe it as...it was almost as if they treated it like it was a hobby," he said. Smith said that many hotel projects would not get built but for the economics of scale of the residential properties. Luxury Travel's Identity Crisis Changing consumer behavior has given luxury travel something of an identity crisis: do today's nigh-end travelers really want the same thing as they did 10, 20 or even 30 years ago. This puts a luxury hotel company like Four Seasons in something of a bind. For Smith, the solution is to push ideas such as "authenticity, ""localism," and "quality." "I think, what you've found is that, there is this sort of commoditization of luxury. And so, it's in many respects there's this intense need to engage in personalization." Smith said the company had seen plenty of success with products such as its Four Seasons Jet,