Starwood has informed Marriott that they intend to terminate their merger agreement unless Marriott can amend terms to satisfy Starwood board that its bid is superior to that of rival offer from Anbang.
The bidding consortium lead by Chinese insurance giant Anbang Insurance Group filed a bid of USD78 per share, valuing the American hotel company at $13.2 billion. Other members of the consortium are J.C Flowers & Co. and Primavera Capital. The merger agreement with Marriot boils down to USD71 per share. See this Hotel News Resource article for the full breakdown of both deals.
Under the terms of Marriott’s merger offer, Marriott has the right to propose ammended terms and Starwood must negotiate in good faith any such revised terms for a period of five business days, ending 11:59 pm Monday March 28th. Anbang Group have confirmed that their offer stands until the end of Marriott’s negotiation period. If Starwood decide to terminate the agreement with Marriott in order to accept the Anbang group bid, it must pay Marriott a termination fee of USD400 million in cash.
Due to the timing of the rival bid proposal and subsequent negotiation period with Marriott, Starwood have postponed their Special Meeting of Stockholders until after the consultation period has ended. However a successful re-bid by Marriott is likely to ignite a bidding war which would extend the process further.
Marriott has responded with the following statement:
“Marriott continues to believe that a combination of Marriott and Starwood is the best course for both companies and offers the best value to Starwood shareholders.
“Marriott is in the process of reviewing the Anbang consortium’s proposal and is carefully considering its alternatives.”
Starwood has more than 1,270 properties in some 100 countries and over 180,000 employees at its owned and managed properties.
Starwood is a fully integrated owner, operator and franchisor of hotels, resorts and residences under the renowned brands: St. Regis, The Luxury Collection, W, Westin, Le Méridien, Sheraton, Tribute Portfolio, Four Points by Sheraton, Aloft, and Element.
There are over 25 Starwood properties in Thailand including:
Marriott International is a global leading lodging company with more than 4,400 properties in 87 countries and territories. Its stable of brands includes JW Marriott, Edition, Gaylord Hotels, Protea Hotels, Moxy, Springhill Suites, Courtyard by Marriott and The Ritz Carlton.