On March 21, Starwood Hotels & Resorts Worldwide accepted a new takeover bid of $13.6 billion from Marriott International. The transaction will create the world’s largest hotel chain, which will include approximately 5,500 hotels in over 100 countries.
On March 18, Starwood had announced its intention to accept a takeover bid from a group of companies led by the Chinese insurer Anbang Insurance Group, despite having entered into an agreement with Marriott International last year.
Marriott’s new offer is $79.5 per share, exceeding the $78 per share offer made by Anbang. Starwood shareholders will receive $21 in cash and 0.8 of a Marriott Class A share for each Starwood share.
Bruce Duncan, Chairman of the Board of Starwood, stated that the hotel chain is pleased that Marriott “recognized the value” that Starwood brings to the merger.
If Starwood decides to terminate the new agreement and accept an offer from other companies, the hotel chain will have to pay a $450 million breakup fee to Marriott, up from the $400 million agreed upon in November 2015.
Starwood’s largest brand is Sheraton, with other brands including St. Regis, Luxury Collection, W, Westin, Le Méridien, Four Points by Sheraton, Aloft, and Element.
Source: Capital
Frequently Asked Questions
What is the value of Marriott’s new offer for Starwood?
The new offer is valued at $13.6 billion, or $79.5 per share, surpassing the previous bid from Anbang Insurance Group.
How large will the new hotel chain be after the merger?
The merger will create the world’s largest hotel chain, featuring approximately 5,500 hotels across more than 100 countries.
What is the penalty if Starwood withdraws from the Marriott deal?
Starwood would be required to pay a $450 million breakup fee to Marriott if it chooses to accept a competing offer.