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Anbang drops bid to buy Starwood, clearing way for Marriott

Anbang says it is dropping its $15 billion offer to acquire Starwood Hotels, citing market considerations as it ends a bidding war with Marriott for the parent of St. Regis and Sheraton resorts.

The China-based insurance company, which was leading a consortium of potential investors, said that it won't proceed further, an abrupt announcement that sent shares of Starwood down 4 percent in late trading Thursday.

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Starwood Hotels & Resorts Worldwide Inc., based in Stamford, Conn., said its board continues to support its existing deal with Bethesda-based Marriott, which initially offered $12.2 billion for Starwood in November. That has since grown to more than $14 billion.

Under the existing agreement, Starwood shareholders will get $21 cash and 0.80 of a Marriott Class A share for each Starwood share held. Starwood shareholders will own about 34 percent of the combined company, which, with 30 brands, would be the world's largest hotel chain.

Marriott International Inc. reaffirmed that its offer creates significant economies of scale and provides shareholders a better deal over the long term. The company owns brands including the Ritz-Carlton and Renaissance hotels.

Together, the two companies and their brands would have more than three dozen hotels around the Baltimore region. Marriott hotels in downtown Baltimore include the Renaissance Baltimore Harborplace Hotel, the Baltimore Marriott Waterfront and the Fairfield Inn & Suites on President Street. Starwood hotels include the Sheraton Inner Harbor Hotel in Baltimore and the Westin Annapolis.

Starwood shareholders are scheduled to vote on the merger April 8.

In after-hours trading, Starwood shares fell 4.4 percent to $79.75. Marriott shares slid 5 percent to $67.64.

Baltimore Sun reporter Natalie Sherman contributed to this article.

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