NEW YORK, March 18 (UPI) -- Starwood Hotels & Resorts Worldwide Inc. said it intends to scrap its previous merger agreement with Marriott in favor of Chinese conglomerate Anbang's increased takeover offer.
The Chinese insurance company, which already owns Waldorf Astoria in New York, raised its fully-financed offer from $76 per share to $78 per share, making the total buy-out price $13.2 billion.
Starwood -- parent company of Westin, Sheraton and W Hotel brands -- announced Anbang's increased price Friday, calling it a "Superior Proposal" in relation to Marriott's.
In a statement released Saturday, Marriott acknowledged the consortium's offer but stated their reservation of the right to revise contract terms within a period of five days ending March 28.
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"Marriott continues to believe that a combination of Marriott and Starwood is the best course for both companies and offers the best value to Starwood shareholders," the statement read. If Starwood returns to its agreement with Marriott, the merger will result in the world's largest hotel chain.
Starwood CEO Tom Mangas sent a memo to employees regarding the merger, saying "It's important to note that Starwood is not permitted to enter into the binding agreement with [Anbang] -- or terminate the Marriott agreement -- until the negotiation period with Marriott has concluded on March 28."
"This is a complicated process that is unfolding in real time and we're all working swiftly to reach resolution," Mangas added.
If Starwood should pull out of the merger with Marriott, it would be obligated to pay Marriott a $400 million termination fee.
Starwood announced Monday it received an unsolicited offer from Anbang to acquire the company at $76 a share, cash. The company raised it to $78 per share by the end of the week.
Marriott, based in Bethesda, Md., offered $72 per share for Starwood, headquartered in Stamford, Conn., in November, and said its offer would not change. A stockholder's vote scheduled for March 28 is expected to be rescheduled due to the circumstances, Marriott and Starwood said Saturday.
