Starwood Hotels & Resorts Worldwide Inc. (NYSE: HOT) received an unsolicited takeover proposal from a group of investors led by China’s Anbang Insurance Group Co., potentially upending a deal with Marriott International Inc. (Nasdaq: MAR) that would create the world’s largest hotel operator.

The offer is $76 a share in cash, Starwood said in a statement on Monday. That values the Stamford, Connecticut-based hotel company at about $12.9 billion, based on its estimate of 170 million shares. While Starwood didn’t identify the bidder, Marriott said in a separate statement that Anbang is leading the group’s proposal, and confirmed it will continue with its own bid.

The surprise offer sets up a potential battle for Starwood, owner of brands such as Westin, W and St. Regis, which agreed in November to be purchased by Marriott in a mostly stock deal. Anbang has been making a push into U.S. hotels, starting with last year’s record $1.95 billion purchase of New York’s landmark Waldorf Astoria. The Beijing-based insurer has also agreed to buy Strategic Hotels & Resorts Inc., the owner of 16 luxury U.S. properties, from Blackstone Group LP for about $6.5 billion, according to people with knowledge of the matter. Starwood shares rose 7.8 percent, the most since late October, to close at $75.93.

Marriott’s bid, which valued the company at $72.08 a share when it was made, is now worth $63.74 a share based on Starwood’s 20-day average stock price through March 11. Tim Craighead, director of Asian Research/Gaming & Lodging for Bloomberg Intelligence, said the new offer is a “very surprising development” because the deal with Marriott seemed to be “done.”

“Any board has to consider, ‘Do I want $76 in cash now or something on the order of $65 in current value in Marriott stock that has the potential to grow,” Craighead said in a phone interview. “That’s the decision Starwood has to make.”

For Anbang, “having a branded portfolio of hotels would allow the company to participate in the growing base of domestic and international travel that’s a side effect of the emerging Chinese consumer class,” Craighead said. A Beijing-based press official for Anbang, who asked not to be named because of company policy, said the insurer had no comment.

A deal to buy Strategic would give Anbang such high-end properties as Four Seasons resorts in Scottsdale, Arizona, and Jackson Hole, Wyoming; Ritz-Carltons in Half Moon Bay and Laguna Niguel, California; San Diego’s Hotel del Coronado; and Manhattan’s JW Marriott Essex House.

J.C. Flowers & Co., the private equity firm founded by Christopher Flowers that focuses on financial companies, and Chinese investment firm Primavera Capital Group are part of the consortium bidding for Starwood, according to two people familiar with the talks. A spokeswoman for Flowers declined to comment and a representative for Primavera couldn’t be immediately reached for comment.

Starwood received a waiver from Marriott to enter talks with the Anbang group and provide due diligence, and began discussions on March 11. The waiver expires at 11:59 p.m. New York time on March 17.

Starwood would have to pay Marriott a $400 million termination fee in cash if it decided to enter into another deal or changes or withdraw its recommendation to its stockholders to vote in favor of the Marriott deal.

Under both offers, Starwood shareholders would also get Interval Leisure Group stock from a previously announced spin off of vacation ownership business, Vistana Signature Experiences, and subsequent merger with ILG.

An acquisition by the Anbang-led group would probably trigger a review by the Committee on Foreign Investment in the U.S., a government panel that examines acquisitions of U.S. businesses by foreign buyers to protect national security.

A foreign acquisition of a U.S. hotel company generally wouldn’t raise security concerns for CFIUS, said Anne Salladin, a lawyer at Stroock & Stroock & Lavan LLP who works on cross-border deals. One area of scrutiny for the committee when reviewing real estate transactions can be the proximity of properties to sensitive U.S. facilities like a military bases, Salladin said. Proximity to government sites has derailed deals in the past, including a Chinese firm’s plan to build a wind farm near a naval base in Oregon. One of Starwood’s properties, the W hotel in downtown Washington, is across the street from the Treasury Department headquarters.

Anbang has experience with CFIUS. Last year, it cleared a review of its purchase of the Waldorf Astoria in New York from Blackstone. At the time, the Waldorf was home to the U.S. ambassador to the United Nations, and the deal initially rose concerns about spying risks.

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