On 18 March, CNBC wrote on how Chinese insurer Anbang was set to acquire international hotel operator Starwood for nearly $13.2 billion. However, on 21 March, according to The Financial Times, Marriott International, Anbang’s rival, made a last-minute comeback in ‘the fiercest bidding was dealmakers have seen in recent history’, by Marriott’s movement of valuing Starwood at nearly $13.6 billion. The political context offered a healthy environment for the final terms of the offer: the historic visit of President Barack Obama to Cuba, accompanied by Marriott’s and Starwood’s bosses. Additionally, for the first time in almost 60 years, US seemed more than welcomed in Cuba through the business move of Starwood signing an agreement to manage three of the most prominent hotels in Havana.
Although the things look good for Marriott, Arne Sorenson, CEO, is doing his best to keep the acquisition on track, as the stakes are enormous for the company and himself as well. Any higher offer from Anbang can put the merger in jeopardy. New York Post quotes David Katz, representative of Tesley Advisory Group, saying that nonetheless Starwood, in accepting Marriott’s revised offer, agreed to no longer engage in discussions with other bidders unless a higher offer should arise. If preserved, the Marriott-Starwood deal, would give birth to the world’s largest hotel chain — bringing together under one corporate entity big industry names such as the Sheraton, Westin, Ritz-Carlton, W and the Marriott nameplates. On 28th March Anbang raised its offer to $14 billion, it is unclear what happens now but could force Marriott to pay up and potentially face a Pyrrhic victory.