|Photo by Freeimages.com/Oden Jaeger|
Starwood Hotels and Resorts Worldwide has announced that the company's Board of Directors has determined a bid to acquire the company by Chinese insurance company Anbang to be a "superior offer" to Marriott International's bid to acquire the company, which was announced back in November.
Anbang launched the unsolicited bid earlier this week, shortly before the merger between Marriott and Starwood was set to close. Under the terms of the merger agreement between Marriott and Starwood, Marriott has the right to propose revised terms, and Starwood must negotiate any revisions in good faith with Marriott, for a period of five business days ending Monday, March 28. If Starwood terminates its agreement with Marriott to accept Anbang's proposal, it would have to pay Marriott a termination fee of $400 million in cash.
In a statement announcing its reaction to the decision, Marriott said that it continues to believe that a combination of Marriott and Starwood is the best course for both companies. Marriott also said it is in the process of reviewing the Anbang consortium's proposal and is carefully considering its alternatives. The company is considering postponing its Special Meeting of Stockholders which is currently scheduled for March 28.
Under the original merger plan with Marriott, in a recent interview Starwood CEO Tom Mangas said that the combined company would be more efficient in terms of spending and have an improved presence in the upscale market. Marriott CEO Arne Sorenson had said that plans were 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 were also slated to remain in place.
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