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More Management Changes for Starwood Hotels

Chief Operating Officer Robert Cotter takes on the additional role of president, after the CEO stepped aside recently.
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Starwood Hotels

(HOT)

announced another management change on Monday, with Chief Operating Officer Robert Cotter taking on the additional role of president.

The change comes nearly two weeks after Chief Executive and Chairman Barry Sternlicht said he

would be stepping aside as CEO, keeping only the role of chairman. Cotter, who has been COO since 2000, will continue to run Starwood's hotel and timeshare operations, leaving only the CEO slot open.

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The announcement of Sternlicht's departure represents a dramatic shift in Starwood's management, with its founder, best known for his dealmaking, stepping aside to spend more time with family. While Sternlicht, who took Starwood from a hotel chain from a market cap of $10 million to $11 billion over the last eight years, will continue in an active role, Monday's announcement clears up some concerns that the company could lose an experienced manager like Cotter.

"In our opinion, Sternlicht's announcement relates to a desire to relinquish the day-to-day operations wile still retaining a strategic role in the company," said Paul Keung, hotel analyst for CIBC, on Nov. 3, after Sternlicht announced he would be stepping down. "The stock traded down throughout the day, which we believed represented uncertainty over his successor and the potential for key executives,

like Bob Cotter, COO, to walk."

Indeed, Cotter has been a key executive for Starwood ever since the company acquired Sheraton. Cotter's entire 30-year career has been with Sheraton. He spent his first 15 years at a variety of posts serving the lucrative Hawaiian and Asian properties. Cotter was named director of Sheraton's hotel marketing in 1988, a vice president in 1989, then an executive vice president in 1993, becoming Starwood's COO in 2000.

With some of the fear removed that Sternlicht's departure would cause a mass exodus of experienced hotel executives, shares of Starwood gained some ground on Monday, adding 20 cents, or 0.6%, to $34.88.