China approves Marriott/Starwood merger; deal to close Friday

(Marriott Starwood)

Marriott International and Starwood Hotels & Resorts Worldwide are finally tying the knot after a 10-month engagement. The companies announced today that their merger transaction has received approval from the Chinese Ministry of Commerce, which had requested extra time for deliberations last month. As this was the last regulatory approval required to complete the merger, Marriott and Starwood are now able to proceed with closing the transaction, and expect the deal to be completed before the market opens on September 23, pending satisfaction of customary closing requirements. 

The deal was announced in November, but hit several road bumps before it could be finalized. In March, China's Anbang Insurance sought to outbid Marriott for Starwood, forcing Marriott to raise their own offer to $13.6 billion. After Anbang walked away from the deal (amid rumors of regulatory concerns in China), a lawsuit and necessary approvals delayed its closing. 

In conjunction with the merger closing, Starwood expects its shares will cease trading on the New York Stock Exchange before market open on September 23, 2016. As previously announced, Starwood shareholders will receive $21.00 in cash and 0.80 shares of Marriott International Class A common stock for each share of Starwood Hotels & Resorts Worldwide common stock.

Assuming that the transaction closes as expected, former Starwood shareholders will be entitled to receive Marriott’s quarterly cash dividend of 30 cents ($0.30) per share of Marriott common stock that Marriott’s Board of Directors declared on September 13, 2016 and which is payable to all Marriott shareholders of record at the close of business on September 23, 2016. In that case, Starwood’s former public shareholders will not receive the dividend declared by Starwood’s Board of Directors on September 13, 2016. The dividend to Marriott shareholders, including the former Starwood shareholders, will be paid on September 30, 2016.