Anbang-led consortium withdraws $14b bid for Starwood

In a statement, it cited "various market considerations" for the decision. This comes only two weeks after Starwood terminated a prior agreement with Marriott in favor of Anbang's initial $13.1 billion offer.

Earlier this week, the Anbang consortium - including J.C. Flowers & Co. and Primavera Capital - raised its all-cash offer to $82.75 per share in response to an amended bid by Marriot that valued Starwood at $79.53 per share, or $13.6 billion. In an announcement on March 31, however, Starwood confirmed that it would commit to a merger with Marriott that values the company at $77.94 per share, or $13.3 billion.

"The existing merger agreement provides substantial value to our stockholders through significant upfront cash consideration and long-term upside potential from projected shared synergies, including $250 million in cost synergies and significant revenue synergies, as well as ownership in one of the world's most respected companies," Starwood CEO Thomas Mangas said.

As of the end of 2015, Starwood managed about 180,000 employees across 1,297 properties in around 100 countries. The majority of these hotels are managed on behalf of third-party owners or franchised out. During the 2015 financial year, revenue fell 16% to $1.3 billion while net income declined 24% to $489 million. The merger with Marriott is expected to create the largest hospitality company in the world. 

Anbang's recent activity in this sector has otherwise included the purchase of Strategic Hotels & Resorts earlier this month from the Blackstone Group for $6.5 billion as well as the $1.9 billion acquisition last year of New York's Waldorf Astoria hotel.

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• Topics
• Greater China
• Buyouts
• Real estate
• China
• J.C. Flowers & Co.
• Primavera
• USA