NEW YORK (TheStreet) -- Shares of Starwood Hotels & Resorts (HOT) were gaining 9.7% to $75.22 on Tuesday following a report that at least three Chinese companies are interesting in bidding for the hotel company.
Shanghai Jin Jiang International Hotels, HNA Group, and China Investment Corp. are all competing for the Chinese government's approval to make a bid for Starwood, according to The Wall Street Journal.
The Chinese government reportedly only wants one domestic company to make a bid in what could be the largest Chinese takeover of a U.S. company yet so the companies aren't bidding against each other. The government is expected to choose which company can make the bid in the next few weeks, according to the Journal.
While the three companies are interested in bidding for Starwood, the Chinese government may reportedly discourage them from making a bid if it thinks the cost is too high.
About 7.7 million shares of Starwood were traded by 2:18 p.m. Tuesday, above the company's average trading volume of about 2.1 million shares a day.
Insight from TheStreet's Research Team:
Starwood Hotels is a part of Jim Cramer's Action Alerts PLUS Charitable Trust Portfolio. Here is what Jim Cramer, Portfolio Manager & Jack Mohr, Director of Research - Action Alerts PLUS had to say about the stock in a recent alert:
After you receive this Alert, we will sell 300 shares of Starwood Hotels (HOT) at around $75.92. Following the trade, HOT will represent roughly 3.74% of the portfolio.
Shares have spiked on reports that a Chinese conglomerate may be placing a bid on the company. We want to book profits before we lose the opportunity, and we can always buy back additional shares if the story proves to have no merit. We'll update as information becomes available.