Shares of Marriott International Inc. (MAR
) jumped more than 3% in morning trading Tuesday to nearly $71 per share after the hotel giant said
it had received antitrust approval from Chinese authorities for its acquisition of Starwood Hotels & Resorts Worldwide Inc. (HOT
Analysts did not immediately respond with upgrade-downgrade actions. Among 20 analysts
covering the stock, the median price target over the past year was $75.
The approval from the Chinese Ministry of Commerce marked the final major regulatory obstacle Marriott needed to clear to cinch the $13.6 billion acquisition — and one that had recently appeared uncertain. Chinese regulators last month said they needed more time to review terms of the deal, even though Marriott had already secured the necessary permissions from some 40 countries, including from U.S. authorities.
In a joint release, the companies said they now expect to close the deal on Friday. Shares of Stamford, Conn.-based Starwood also climbed more than 3% in early trading Tuesday.
The companies said Starwood shares are slated to cease trading on the New York Stock Exchange before the market opens Friday. Starwood shareholders will receive $21 in cash and 0.8 shares of Marriott for each share of Starwood common stock they hold. Starwood shareholders also are scheduled to receive Marriott's quarterly cash dividend of 30 cents per share of Marriott common stock, to be paid Friday.
The deal will create one of the world’s biggest hotel companies. After closing, Bethesda, Md.-based Marriot will have more than 1 million rooms worldwide, generating nearly $20 billion in annual revenue.
For the second quarter, Marriott recently reported
adjusted net income of $265 million, a 10% increase from a year earlier. Adjusted diluted earnings per share totaled $1.03, an 18% jump from the year-ago quarter. The adjusted figures exclude certain costs tied to the Starwood deal.