November 17, 2015
Bernstein Liebhard LLP is investigating whether the Board of Directors of Starwood Hotels & Resorts Worldwide, Inc. (“Starwood”) (NYSE: HOT) breached its fiduciary duty to its shareholders in agreeing to sell (the “Merger”) Starwood to Marriott International, Inc. (NASDAQ: MAR).
Under the terms of the agreement, Starwood shareholders will get 0.92 shares of Marriott and $2 in cash for each share of Starwood common stock. Separately, they will also get $7.80 per Starwood share upon completion of a spin-off of Starwood’s timeshare business to Interval Leisure Group. That spin-off is supposed to be completed prior to the Merger. The Merger has a value of $72.08 per Starwood share, including the $2 cash per share. Starwood shareholders will own approximately 37% of the combined company.
The investigation is focused on the potential unfairness of the consideration offered to Starwood shareholders and the process by which the Starwood Board of Directors considered and approved the Merger. Tellingly, right after the Merger was announced, Starwood shares fell over 5% to $71.13 per share in morning trading on Monday. Indeed, TheStreet’s Jim Cramer said that “[t]his is a terrible deal for Starwood shareholders” on CNBC’s Squawk on the Street.
Bernstein Liebhard LLP has pursued hundreds of securities, consumer and shareholder rights cases and recovered over $3.5 billion for its clients. The National Law Journal has recognized Bernstein Liebhard for twelve consecutive years as one of the top plaintiffs’ firms in the country.