Hotel Bidding Could See Largest Takeover of a US Company by Chinese Counterpart

Shuang Shan

Three Chinese companies have expressed interest in bidding for Starwood Hotel & Resort Worldwide, a deal that would mark the largest Chinese acquisition of US company ever. Shanghai Jin Jiang International Hotels (Group) Company Ltd, HNA Group, and China Investment Corporation (CIC) each submitted a proposal to Beijing over the past two months and expect a winning bidder to be chosen before the end of year.

Beijing is currently reviewing each proposal separately to avoid a bidding war among Chinese companies, ultimately raising the price. The winning bidder is expected to pay at least $12 billion for Starwood based on current market value, overtaking CIC’s $5.6 billion investment in Morgan Stanley as the largest Chinese acquisition of a US company.

If a bidder succeeds in Beijing, analysts say that the Committee on Foreign Investment in the United States is likely to approve a Chinese acquisition of Starwood. The Chinese interest in Starwood, following Anbang Insurance Group Co., Ltd.’s $2 billion deal to buy the Waldorf-Astoria hotel in New York, is the latest sign of Chinese investment interest in US real estate and hospitality sector.

(Photo by Kevin Baird via Flickr)