(Bloomberg) --Starwood Hotels & Resorts Worldwide Inc. said it received a higher takeover offer from a group led by Anbang Insurance Group Co., putting the Chinese company back into battle with Marriott International Inc. for control of the hotel operator.
Starwood said the Anbang group offered $82.75 a share in cash, or about $14 billion, according to a statement Monday. That compares with Marriott’s stock-and-cash offer valued at $75.91 a share, or about $12.8 billion, based on Thursday’s closing price.
Starwood said it received a non-binding bid of $81 a share on March 26 from the Anbang group, which increased its offer after subsequent discussions. Starwood is negotiating terms of a binding proposal and said it will “carefully consider the outcome of its discussions with the consortium” in order to determine the best course of action for shareholders.
Shares of Starwood rose 2.5 percent to $84.16 at 9:41 a.m. New York time. Marriott climbed 3.7 percent to $71.18.
The new offer from Anbang, which is working with J.C. Flowers & Co. and Primavera Capital, shows the insurer won’t easily back down as it seeks to build its hotel holdings. The Beijing-based company last year purchased Manhattan’s landmark Waldorf Astoria for $1.95 billion, and is in a deal to acquire luxury-property owner Strategic Hotels & Resorts Inc. for about $6.5 billion. Gaining Starwood would add brands such as Sheraton, W and St. Regis, as well as about $4 billion worth of real estate.
Starwood, which has had a merger agreement with Marriott since November, on March 21 said it would proceed with an amended deal after receiving a sweetened bid from its larger competitor. A 6.2 percent decline in Marriott’s stock in the four days through Thursday pushed the value of its latest offer below the Anbang group’s previous cash bid of $78 a share.
Representatives for Marriott and Anbang didn’t immediately return calls seeking comment on the new offer.
Marriott is offering 0.8 share and $21 in cash for each Starwood share. That deal, which would create the world’s biggest lodging company, is set for a shareholder vote on April 8. Marriott would be paid a $450 million termination fee if it falls apart.
The Anbang group is being advised by PJT Partners Inc. Starwood is being advised by Lazard Ltd. and Citigroup Inc. Marriott is working with Deutsche Bank Securities.
An Anbang-led purchase of Starwood would mark the largest takeover of a U.S. company by a Chinese investor, surpassing the 2013 sale of Smithfield Foods for about $7 billion.
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