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SAN FRANCISCO - Sonder Holdings Inc. (NASDAQ: SOND), a hospitality company, has announced a series of financial maneuvers designed to solidify its balance sheet and reduce costs by about $50 million annually, leveraging its ongoing integration with Marriott International, Inc. (NASDAQ: MAR), a hospitality giant with a market capitalization of $62 billion. The company completed the sale of approximately $18 million in Series A preferred stock on Monday, April 11, 2025, and amended its Note and Warrant Purchase Agreement to decrease the principal balance by 15% and cut the interest rate by roughly half.According to InvestingPro analysis, Marriott demonstrates strong financial health with impressive gross profit margins of 81.87%, positioning it as a robust partner for this integration.
This financial reshaping comes as Sonder anticipates full integration with Marriott’s digital channels by the end of the second quarter of 2025. This integration will place Sonder properties on Marriott.com and the Marriott Bonvoy mobile app under the new "Sonder by Marriott Bonvoy" collection. The collaboration is expected to expose Sonder’s properties to Marriott’s vast sales network and nearly 228 million members of the Marriott Bonvoy travel platform. The partnership began in October 2024 with the first phase of integration.
Sonder’s CEO, Francis Davidson, expressed confidence that these strategic steps would enhance the company’s positive revenue per available room (RevPAR) and profitability trends. Davidson noted that the integration is nearing completion and that the company is positioning itself for the next phase of growth. The cost reductions are anticipated to stem from a mix of staff cuts, software savings, and other efficiencies associated with the Marriott integration. For deeper insights into both companies’ financial health and growth prospects, investors can access comprehensive Pro Research Reports through InvestingPro, which covers over 1,400 US equities with detailed analysis and actionable intelligence.
The details of the equity financing and the amended agreements have been disclosed in a Form 8-K to be filed with the Securities and Exchange Commission (SEC). Moelis & Company LLC acted as the financial advisor to Sonder during these transactions.
Sonder, founded in 2014, operates premium, design-forward apartments and boutique hotels in over 40 markets worldwide. The company is known for its tech-enabled service and seamless guest experience, managed through the Sonder app.
The information in this article is based on a press release statement from Sonder Holdings Inc.
In other recent news, Marriott International has issued $2 billion in new debt, with the proceeds earmarked for general corporate purposes, including potential acquisitions and stock repurchases. The company has issued $500 million in 5.100% Series RR Notes due 2032 and $1.5 billion in 5.500% Series SS Notes due 2037. Meanwhile, Marriott has expanded its portfolio by launching its first City Express by Marriott property in Duluth, Georgia, marking its entry into the U.S. midscale market. This expansion is part of a strategy to open over a dozen properties in the region by the end of the year.
Goldman Sachs recently downgraded Marriott’s stock from Buy to Neutral, citing economic volatility and consumer pressures as challenges for the hospitality sector. The firm also lowered its price target for Marriott shares from $313 to $245. UBS, on the other hand, maintained its Neutral rating for Marriott, with a price target of $301, highlighting the company’s ongoing digital transformation efforts. Mizuho Securities increased its price target for Marriott to $293 from $246, maintaining a Neutral rating and acknowledging concerns over the company’s earnings algorithm compression.
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