Marriott International and Starwood Hotels & Resorts Worldwide sign off amended merger agreement, with Starwood shareholders now standing to gain a better cash deal
Hospitality giants Marriott International and Starwood Hotels & Resorts Worldwide today revealed that they had signed off on an amendment to their merger agreement.
The new deal revises the value of Starwood shares to $13.6bn (£9.5bn) in total, which is $79.53 per share or $85.36 per share after consideration from separate transaction involving Interval Leisure Group is taken into account.
The amendment also states that Starwood shareholders will receive $21 in cash and 0.8 shares of Marriott International Class A common stock per share, which will lead to current Starwood shareholders holding around 34 per cent of the shares in the newly merged company.
The original merger deal was struck between the two companies last November for $12.2bn in cash and shares.
However, last week, Starwood received a takeover bid from China's Anbang Insurance Group worth $12.8bn.
"After five months of extensive due diligence and joint integration planning with Starwood, including a careful analysis of the brand architecture and future development prospects, we are even more excited about the power of the combined companies and the upside growth opportunities," said Arne Sorenson, president and chief executive of Marriott International. "We are also more confident of achieving our updated target of $250 million of cost synergies. With a higher cash component in the purchase price, we have improved the transaction's financial structure as well."
Bruce Duncan, chairman of Starwood, added: "We are pleased that Marriott has recognised the value that Starwood brings to this merger and enhanced the consideration being paid to Starwood shareholders. We continue to be excited about the combination of Starwood and Marriott, which will create the world's largest hotel company with an unparalleled platform for global growth in the upscale segment. We are also pleased with the progress the two companies have made toward closing."