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In October, I wrote about Choice Hotels initiating a hostile takeover. Choice Hotels International is now walking away from its bid to acquire Wyndham Hotels & Resorts for around $7 billion. The deal had been in the works for around a year and was fought hard by Wyndham’s board and shareholders over the unwelcome bid.
The budget hotelier has a portfolio of around 7,500 properties. Wyndham holds 9,280 locations and bills itself as the largest hotel franchisor in the world. The combined portfolio would have had over 16,000 properties across 42 brands. Choice Hotels® acquired Radisson Hotels Americas in 2022 to bulk up its portfolio. For context, Marriott International has around 8,500 hotels, Hilton Hotels & Resorts has over 7,000, and Hyatt Hotels Corporation reports around 1,350.
Reuters reports that Choice first approached Wyndham last April with a cash-and-stock offer. Based on Friday’s closing price for Wyndham shares, the offer was around $89 per share or about $7.2 billion total. In December, Choice targeted Wyndham’s shareholders to break a stalemate in its acquisition by unveiling an exchange offer for Wyndham’s stock.
Stephen P. Holmes, Chairman of the Board for Wyndham Hotels & Resorts, said:
The Wyndham Board is pleased that Choice has ended its hostile pursuit and proxy contest, following the expiration of its unsolicited exchange offer. We are confident in Wyndham’s standalone strategy and growth prospects under the leadership of our proven management team. The Board remains committed to acting in the best interests of our shareholders and driving superior long-term value creation.”
Wyndham fought off Choice repeatedly even as the hotelier targeted its shareholders and even nominated its own slate of directors to replace the eight members of Wyndham’s board of directors. Other concerns centered around antitrust risk (as was just demonstrated with the failed JetBlue/Spirit bid), the combined company carrying too much debt, and a slowdown in business.
Anthony’s Take: Mergers and acquisitions are hard to get off the ground currently. JetBlue and Spirit sputtered and this massive hotel tie up is now also off the table.
(Image Credits: Prostock-Studio and Choice Hotels.)
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