Sheraton owner Starwood set to accept offer from China’s Anbang

NEW YORK, NY - MARCH 14: People walk pass a Sheraton Hotel in downtown Brooklyn on March 14, 2016 in New York City. A fight for the Starwood Hotel chain, which Sheraton is a member of, is underway following a $14 billion buyout offer Monday from a consortium led by China's Anbang Insurance Group. Spencer Platt/Getty Images/AFP == FOR NEWSPAPERS, INTERNET, TELCOS & TELEVISION USE ONLY ==

BENGALURU: Starwood Hotels & Resorts Inc, the operator of Sheraton and Westin hotels, said on Friday it planned to accept a raised buyout offer from a group led by China’s Anbang Insurance and scrap its deal with Marriott International Inc.

A succcessful deal would bolster Anbang’s reputation as one of China’s top corporate acquirers and would follow its purchase of New York’s iconic Waldorf Astoria hotel last year.

It would also be the biggest acquisition of a US company by a China-based investor.

Anbang’s new offer raises the value of Starwood to US$13.16bil (RM53.28bil) from US$12.82bil (RM51.91bil), based on shares outstanding as of Feb 19. Marriott had offered US$12.2bil (RM49.40bil) for Starwood.

Anbang has also agreed to buy Strategic Hotels & Resorts Inc for around US$6.5bil (RM26.32bil), a person briefed on the matter told Reuters last week.

Strategic Hotels’ properties include the Four Seasons Washington, DC on Pennsylvania Avenue, the Westin St Francis on Union Square in San Francisco and the beach-front Ritz-Carlton Laguna Niguel in Orange County, California.

Marriott, which has until March 28 to counter Anbang’s offer, said it was considering its options.

The Anbang-led group, which includes private equity firms JC Flowers & Co and Primavera Capital Ltd, has raised its cash offer for Starwood to US$78.00 per share from US$76.00, Starwood said on Friday.

Starwood’s shares were up 4.6% at US$79.90 in early trading.

Starwood shareholders will also receive stock in Interval Leisure Group Inc, which is buying Starwood’s vacation ownership business for about US$5.67 per Starwood share. - Reuters