Holiday Inn

Abstract

Although it's the largest hotel chain in the world and one of the oldest, Holiday Inn Worldwide can be considered one of the newest companies in the hotel industry. As chronicled in this article, Holiday started as a franchising vehicle for hotels and then diversified into related businesses. In the 1980s it became a gaming operator and also operated additional lodging brands. To avoid the possibility of a corporate takeover, Holiday's management recapitalized the company in 1987 by selling assets, paying an immense shareholder dividend, and taking on debt. A second recapitalization in 1989 was a springboard for the spin-off and sale of the Holiday Inn brand to Bass PLC. The other portions of the former Holiday Corporation, including the gaming operation, did business as Promus Corporation. Saddled with considerable debt and facing the uncertain prospects of the 1990s, Bass has developed a new strategy for Holiday Inn Worldwide that includes converting older inns to the new Holiday Inn Express (limited service) concept. In addition, Holiday is experimenting with SunSpree Resorts, a resort concept intended to fill a gap in the market for moderate-price resorts.