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Internation hotel and leisure company Starwood Hotels & Resorts Worldwide on Monday (21 March) announced that it has accepted an improved takeover offer from Marriott International valued at US$13.6 billion (S$18.51 billion), proceeding with its initial plan of creating the world’s biggest hotel chain, and spurning a bid from China’s Anbang Insurance Group.
Marriott raised the cash portion of its offer to US$21 (S$28.59) per share from US$2 (S$2.72) previously, valuing the total bid. It values the company at US$79.53 (S$108.26) per share based on Marriott’s close of trading on Friday (18 March). This compares to the Anbang-led group’s cash bid of US$78 (S$106.18) or about US$13.2 billion.
It is noted that Marriott had previously clinched a deal with Starwood in November for $72.08 per share or about US$12.2 billion (S$17.37 billion) in total bid.
“Marriott is confident it can achieve $250 million in annual cost synergies within two years after closing, up from $200 million estimated in November 2015 when announcing the original merger agreement,” the company said in a statement.
Meanwhile, under the revised agreement, Starwood would pay a breakup fee of $450 million, up from $400 million previously.
Lazard and Citigroup Global Markets are financial advisers to Starwood, while Marriott’s financial adviser is Deutsche Bank Securities.
Nikki De Guzman, Editor at CommercialGuru, wrote this story. To contact her about this or other stories email nikki@propertyguru.com.sg
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