Sinking euro forces Starwood Ciga sale

Starwood Hotels & Resorts is putting its luxury European chain Ciga up for sale next year, blaming the weak state of the euro for insufficient returns.

The group of 25 hotels, which includes the Danieli hotel and Hotel Gritti Palace in Venice, the Palace hotel in Madrid and the Grand hotel in Florence, is expected to fetch more than $1.2b (£830m).

But Starwood said the weakness of the euro meant an immediate sale was out of the question.

"We consider our global diversification, including our ownership of trophy international assets, a competitive advantage that this year, given the decline of the euro and Latin American economic conditions, has adversely impacted on our growth rate," said Starwood chairman Barry Sternlicht.

Starwood owns more than 725 properties in 80 countries.

It bought a 70% stake in the Ciga chain in 1997 as part of an acquisition of the former ITT Corporation and bought the remaining 30% earlier this year.

Starwood's third-quarter 2000 results showed that total like-for-like revenues increased by 16% to $1.11b (£760m).