What Marriott Is Telling Its Shareholders About Starwood the Second Time Around
Skift Take
Unlike Marriott, Starwood doesn’t need to be as persuasive in its communications with shareholders about the new deal. It just has to give them the facts and urge them to vote in line with the board’s recommendation. Instead, it can wait to see if a better offer comes up unexpectedly which, if history has shown, is still a definite possibility.
Now that Marriott International and Starwood Hotels & Resorts have agreed to a newly revised merger agreement — one that involves more cash and a higher value than the original one from November — both companies notified their respective stockholders on March 24, urging them to vote for the new deal, and to hold stockholder votes on April 8 to close it.
Both notes clearly outlined the terms of the revised agreement, under which Starwood shareholders receive 0.8 shares of Marriott stock plus $21 in cash for every share of Starwood common stock, but the exact monetary value of the deal depends on how Marriott’s stock will be if and when the deal closes on April 8. With the new merger, Marriott stockholders will own 66 percent of the combined company, and Starwood shareholders will own 34 percent. Starwood shareholders will also receive a separate amount of money from the spin-off of Starwood’s timeshare business and its merger with Interval Leisure Group, which is valued at $5.83 per share of Starwood common stock.
What Starwood is Saying — and Not Saying
In his note to shareholders, Starwood CEO Thomas B. Mangas was clear and succinct in describing the need for their proxy votes. Bolded in his letter was the following sentence, emphasizing the Starwood Board of Directors’ desire to proceed with the new Marriott deal: "The Starwood Board of Direc
