|Photo by Freeimages.com/Mike Johnson|
A consortium of potential investors led by Anbang Insurance Group has launched an unsolicited bid to acquire Starwood Hotels & Resorts Worldwide ahead of the closing of Starwood's merger with Marriott International.
The New York Times reports that Anbang Insurance Group, an insurance company based in China, is the same company that bought the Waldorf Astoria in New York for $1.95 billion. The Times said that Anbang's offer represents a significant premium on Marriott's offer to purchase Starwood, which has been affected by a decline in stock price since the merger was announced this past November.
In a statement announcing the new bid, Marriott said that it remains confident that the previously announced merger agreement is the best course for both companies. Starwood has said that its Board of Directors has not changed its recommendation in support of the Marriott - Starwood merger. Marriott has granted Starwood a waiver to expedite its evaluation of the letter from the interested consortium ahead of a vote by each company's stockholders on March 28.
In a recent interview, Starwood CEO Tom Mangas said that the merger with Marriott would allow both companies to be more efficient in terms of spending, as well as improve Starwood's presence in the upscale market. When asked about the influence of OTAs and Airbnb on the deal, Mangas said that competition with intermediaries did not factor in to both companies' decision. He noted, however, that "scale matters in this business."
In terms of what the merger would mean for both companies' brands, Marriott CEO Arne Sorenson said that the combined company plans to keep all of Starwood's luxury brands, including St. Regis, The Luxury Collection and W. On Marriott's side, the luxury Ritz-Carlton, Bulgari, Edition and Autograph brands are also slated to remain in place, Sorenson said.
“We think the demographics around luxury travel are positive for the long-term," Sorenson said in an interview at PCMA/Convening Leaders in Vancouver in January. "We'd like to have as many strong brands to plan in this space as possible and make sure we're delivering experiences, which are distinct."
Keep visiting www.travelagentcentral.com for further updates to this developing story.