A third party made an offer to purchase Starwood late last week (read more here) and Marriott gave Starwood a waiver to explore it until March 17th.
March 17th has now come and gone and there have been no updates from Starwood or Marriott. The suitor, however, has hired a proxy solicitation firm to advise how to go forward with the bid.
There was an update on Reuters yesterday (access here) of which below is an excerpt:
Anbang has hired proxy solicitation firm Georgeson Inc, which has already started to contact Starwood shareholders, the sources said. Anbang will decide on its next move based on Starwood’s response to its offer, the sources said.
The sources asked not to be identified because the deliberations are confidential.
Anbang declined to comment. Representatives of Starwood, Marriott and Georgeson did not immediately respond to requests for comment.
Starwood has said it received a waiver from Marriott that allows it to engage in discussions with Anbang and its consortium. The waiver expires at midnight on Thursday but could be extended.
We should learn soon what Starwood’s board has decided. It is their fiduciary duty to choose the offer that is most beneficial for their shareholders, which in this case would be the rival bid.
Current Starwood shareholders can always use the cash from the proceedings to purchase Marriott stock if they so choose.
Considering the current price of the Starwood stock (higher than Marriott’s offer), it is difficult to see how the merger would proceed as previously planned.