Marriott, Starwood shareholders approve merger

Shareholders of Marriott International and Starwood Hotels and Resorts today voted to approve a merger between the two companies that will create the largest hotel chain in the world.

At separate meetings Friday morning, shareholders of each company agreed to the deal, which will give Starwood stockholders 0,8 shares of Marriott common stock plus $21 in cash for each share of Starwood common stock.

Bethesda, Md.-based Marriott will end up paying about $13.3 billion, or $77.94 per Starwood share, for the Stamford-Conn.-based company.

"With today's successful stockholder approval milestone, we are that much closer to completing our transaction," Marriott CEO Arne Sorenson said in a written statement.

Sorenson, who will lead the combined companies, says he expects the deal to close by the middle of this year,

"Our teams continue to plan the integration of our two companies, and we are committed to a timely and smooth transition," Sorenson said. "We appreciate the stockholders' vote of confidence in our ability to drive long-term value and opportunity as a combined company."

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Holders of more than 97% of Marriott shares present and voting at the meeting, representing over 79% of outstanding shares, voted in favor of the deal. Holders of more than 95% of Starwood shares present and voting at the meeting, representing over 63% of outstanding shares, gave their consent.

​The votes cap weeks of jostling in which China-based Anbang Insurance Group swooped in to try to take Starwood away from Marriott with an all-cash bid.

Marriott agreed to buy Starwood in November for $12.2 billion — $2 in cash and 0.92 of its own shares for each Starwood share.

Starwood dropped the bid March 18 in favor of Anbang’s $13 billion all-cash offer, despite a $400 million break-up fee for walking away from Marriott.

Marriott counter-offered, which led to a stronger Anbang bid that it quickly withdrew in a surprise move.

"This is exciting news on a number of fronts: In addition to achieving a key milestone in our merger process, this affirmative vote by Starwood’s shareholders effectively ends the possibility for any other bids for Starwood," Sorenson said in an internal memo to employees this morning. "That’s great news given the ups and downs of the past few weeks." 

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As part of the deal, Starwood shareholders will own about 34% of the combined company’s common stock after completion of the merger.

"There is no doubt that this transaction puts our company on the best path forward and we remain excited about the opportunity this combination will create for our stockholders, associates, owners and guests," said Starwood CEO Thomas Mangas.

Marriott has already cleared the pre-merger antitrust review in the USA and Canada. But a few other steps remain before the deal can close, including Starwood's planned sale of its timeshare business, expected on or around April 30.

Marriott also has to obtain regulatory approvals from the European Union and China. But Sorenson told employees he expects to clear those in the next couple of months.

The combined company will have 30 brands and 1.1 million rooms. Starwood’s brands include the Westin, W Hotels, St. Regis, and Aloft. Marriott has Renaissance, AC Hotels, The Ritz-Carlton, among others.