Starwood And Marriott Closer To Mega Merger

Marriott has won the support of Starwood Hotels' board, after upping its takeover offer to $13.6bn (£9.45bn).

The merger would create the largest hotel chain in the world, but was almost derailed by a rival bid from Chinese insurance company Anbang, which swooped in last week.

Starwood's board said today's bid from Marriott was a "superior proposal" to Anbang's $13.2bn offer.

Marriott is offering $21 in cash and 0.8 of a Marriott share for each one of Starwood's, amounting to $79.53 a share.

The merger would give Marriott, which owns Ritz-Carlton hotels, access to a younger customer base through Starwood and its St Regis resorts.

It (Other OTC: ITGL - news) would also allow Marriott to increase its presence in the Asian market, where Starwood is the largest operator of four and five star hotels.

The combined group would have more than 1.1 million rooms around the world, in 5,500 properties, including Starwood's Sheraton and Le Meridien brands.

Starwood shareholders will control around 34% of the combined company.

Marriott said in a statement it was confident it could increase the savings it made from the merger, up from $200m (£153m) to $250m (£174m)-a-year

Marriott's original offer last November was worth $12.2bn (£8.5bn).

Bruce Duncan, chairman of Starwood, said: “We are pleased that Marriott has recognised the value that Starwood brings to this merger.

"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."