BETHESDA, MD—Marriott International wasted little time coming back with a sweetened offer to merge with Starwood Hotels & Resorts Worldwide, creating the world's largest lodging company. The two hotel operators said Monday they had signed a revised merger agreement, just three days after the Starwood board accepted an all-cash bid from a consortium led by Anbang Insurance Group Co. Ltd. That bid is no longer under consideration, Marriott and Starwood said Monday.

The revised merger agreement values Starwood at $13.6 billion, not including its timeshare business, compared to $13.2 billion from the Anbang consortium. The previously announced spin-off of Starwood's timeshare unit, Vistana Signature Experiences, and Vistana's merger with Interval Leisure Group will give Starwood shareholders an additional $5.83 per share.

“After five months of extensive due diligence and joint integration planning with Starwood, including a careful analysis of the brand architecture and future development prospects, we are even more excited about the power of the combined companies and the upside growth opportunities,” says Arne Sorenson, president and CEO of Marriott. “We are also more confident of achieving our updated target of $250 million of cost synergies. With a higher cash component in the purchase price, we have improved the transaction's financial structure as well.”

However, no real estate transaction is final until closing has taken place, and the Anbang group, which has been on a US hotel buying spree, could still come back with a higher bid. “We continue to view Anbang as a company with lower return requirements and believe Anbang would need to bid at least $84 in order to compensate Starwood for a longer closing period and increased uncertainty on the regulatory front,” Wes Golladay, an analyst with RBC Capital Markets, wrote in an investors note Monday. Anbang's most recent bid was for $78 per share; read this morning's top story for a look at three groups who are hoping Anbang prevails.