Marriott announced on Monday that it will acquire Starwood Hotels in a cash and stock deal worth approximately $75.75 per share. The market seems to be skeptical of the deal pricing, as Starwood’s stock is trading down more than 4.5 percent following news of the buyout.

What’s Behind The Deal?

According to Scott Kim, research director for the Kellner Merger Fund, this deal was likely motivated in part by market pressures from online travel companies such as Priceline Group Inc PCLN 1.6%, Expedia Inc EXPE 3.59% and Tripadvisor Inc TRIP 6.45%.

“In addition to the rationales stated in Marriott’s press release, hotel operators are trying to gain scale to keep up with the recent consolidation and power of the online travels companies,” Kim told Benzinga.

Patience Required

For arbitrage opportunists who have noticed the rather large spread between the buyout price and the current trading price of Starwood, Kim predicts it could be a long wait before profits are…

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