Starwood was being shopped aggressively for over 6 months, and Marriott wound up the high bidder in the eyes of the Starwood board. There was interest from Hyatt. Possible interest from IHG and Wyndham.
Two weeks ago Starwood’s customers and shareholders were excited by a Chinese group led by insurer Anbang making a substantially higher offer for the hotel chain than the pending Marriott Marriott acquisition deal.
Then last Monday Marriott increased their offer substantially to take the lead in the acquisition of Starwood. Marriott’s offer is 0.8 Marriott shares and $21 in cash for each Starwood share. A shareholder vote was scheduled for April 8.
On Monday Chinese insurer Anbang came back with a higher offer. However Anbang is reportedly dropping out of the race to acquire Starwood.
Marriott shares closed at $71.18, valuing their offer for Starwood at $77.94 — or slightly less than the previous $78 a share fully financed Anbang offer they supposedly had ‘beaten’.
That leaves Marriott alone as the acquirer, unless someone else comes in with an offer above $78 in the next 9 days. Which means in all likelihood Marriott suffers the Winner’s Curse on the deal. At least they didn’t raise their offer again!