Starwood Hotels surges on fresh buyout bid of $76 a share

Shares in Starwood Hotels & Resorts Worldwide surged in pre-market trade after it said it had received an unsolicited buyout bid from a consortium of companies for $76 per share in cash.

Back in November, Starwood agreed a merger with Marriott International, which said on Monday that it remained committed to the deal.

Marriott said it believed the previously-announced merger - which would create the world’s largest hotel company - was "the best course for both companies”.

“The combined company will offer stockholders significant equity upside and greater long term value driven by a larger global footprint, wider choice of brands for consumers, improved economics to owners and franchisees leading to accelerated global growth and continued strong returns,” it said in a statement.

Marriott also revealed that the consortium of investors interested in Starwood was being led by China’s Anbang Insurance Group.

Starwood said that under the deal, stockholders would also receive a consideration in the form of Interval Leisure Group common stock from the previously announced spinoff of its vacation ownership business, Vistana Signature Experiences, and subsequent merger with ILG, currently valued at approximately $5.50 per Starwood share.

The company has received a waiver from Marriott enabling it to engage in talks with and provide diligence information to the consortium.

Starwood began the discussions with the consortium on 11 March and the Marriott waiver expires at the end of the day on 17 March.

“Starwood’s board of directors has not changed its recommendation in support of Starwood’s merger with Marriott.

“The board, in consultation with its legal and financial advisors, will carefully consider the outcome of its discussions with the consortium in order to determine the course of action that is in the best interest of Starwood and its stockholders.”

Starwood said there can be no assurance that talks with the consortium will result in a binding proposal or that a transaction will be approved or consummated.

At 1228 GMT, Starwood shares were up 8.4% to $76.40.