Starwood Hotels & Resorts Worldwide Inc (NYSE:HOT) stock gained as much as 8.6% today after the U.S. hotel operator received a rival takeover bid from an investor group led by China’s Anbang Insurance Group, potentially derailing a deal with Marriott International Inc (NASDAQ:MAR).
Shares of Starwood, which owns hotel brands as Sheraton and Le Meridien, rose to as high as $76.44 before paring gains to $75.60, up 7.4%, at 11:23 a.m. in New York. The stock is currently trading 32% higher than its January 20 low of $56.87.
The consortium submitted its $76.00 a share offer on March 10, Connecticut-based Starwood said in a statement before the opening bell this morning.
The China bid values Starwood at $12.84 billion, which represents a significant premium to Marriott’s deal.
Marriott’s proposal of $72.08 a share in stock and cash valued Starwood at $12.18 billion on November 16. That bid is now worth about $11.0 billion as Marriott shares have declined 6.5% since.
Marriott said in a separate statement today that it remained committed to its November offer for Starwood, which would create the world’s largest hotel chain.
The combined company—to be led by Marriott president and CEO Arne Sorenson—would feature around 1.1 million rooms in 5,500 properties in more than 100 countries.
Shareholders of each company are expected to vote on the Marriott deal on March 28. Marriott would receive a termination fee of $400.0 million if Starwood backed out of the deal.
Starwood said it received a waiver from Marriott that allows it to engage in discussions with the Chinese consortium. The waiver will expire at 11:59 p.m. on March 17.
Starwood’s board said it isn’t changing its recommendation that shareholders accept the Marriott offer.
Chinese buyers have pushed to buy U.S. hotel properties lately. Asian buyers in recent years have acquired New York’s Plaza Hotel and Carlyle Hotel at prices that exceeded $1.4 million a room.
Anbang is also near a deal to buy Strategic Hotels & Resorts Inc. from a Blackstone-managed real-estate fund
Anbang cut a $6.5 billion deal with Blackstone Group for the Strategic Hotels & Resorts, whose portfolio has 16 properties with 7,532 rooms as well as meeting and banquet space.
Among the Strategic Hotels properties are the Four Seasons Resort in Jackson Hole, Wyoming, Ritz-Carlton locations in California, and the Fairmont Scottsdale in Arizona.
A decade ago, Anbang was a small Chinese auto insurer, but it has been an aggressive acquisition maker in recent years.