Marriott International Inc. is facing the prospect that four months of work toward completing a purchase of Starwood Hotels & Resorts Worldwide Inc. is about to come undone.
Starwood received a takeover offer of US$82.75 ($105.79) a share, or US$14 billion, from a group led by China’s Anbang Insurance Group Co. That’s higher than Marriott’s last bid, raising the stakes for the lodging company to counter a second time to save a merger that would create the world’s biggest hotel operator. Marriott has planned on the acquisition since November, when Starwood first agreed to be bought by its larger rival in a cash-and-stock deal.
“The time and energy they’ve invested is not something they’re going to happily walk away from,” said Tom Baker, corporate managing director at commercial real estate services firm Savills Studley. “It’s just a question of can they justify paying more than they’ve already bid, and at what point does it stop?”
Marriott’s options include letting Anbang buy the company it covets; paying a price so high that the merger may become too financially risky; or finding ways to make a more-expensive acquisition pencil out, possibly through property sales. The 89-year-old company, founded by the father of its executive chairman, has been acquiring hotel companies to expand globally, though none of its targets have been as big as Starwood.
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Starwood received a takeover offer of US$82.75 ($105.79) a share, or US$14 billion, from a group led by China’s Anbang Insurance Group Co. That’s higher than Marriott’s last bid, raising the stakes for the lodging company to counter a second time to save a merger that would create the world’s biggest hotel operator. Marriott has planned on the acquisition since November, when Starwood first agreed to be bought by its larger rival in a cash-and-stock deal.
“The time and energy they’ve invested is not something they’re going to happily walk away from,” said Tom Baker, corporate managing director at commercial real estate services firm Savills Studley. “It’s just a question of can they justify paying more than they’ve already bid, and at what point does it stop?”
Marriott’s options include letting Anbang buy the company it covets; paying a price so high that the merger may become too financially risky; or finding ways to make a more-expensive acquisition pencil out, possibly through property sales. The 89-year-old company, founded by the father of its executive chairman, has been acquiring hotel companies to expand globally, though none of its targets have been as big as Starwood.
Click Here To Register For Free Trial Services OR Give A Missed Call : +6531581402 Follow Us On Twitter : www.twitter.com/epicresearchsg Like Us On Facebook : www.facebook.com/EpicResearchSingapore Need Any Assistance Feel Free To Mail Us at : info@epicresearch.sg
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