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Choice Hotels is launching a competitive bid for Wyndham Hotels & Resorts after a failed deal with hotel
Choice Hotels said Tuesday that its exchange offer to shareholders of Wyndham, which operates Days Inn, La Quinta, Ramada and several other brands, is the same as its final offer to the company’s management. , which is $49.50 in cash and 0.324 shares of Choice. common stock per share of Wyndham. The exchange offer gives Wyndham shareholders the option to receive all cash, all shares or a combination of the two.
The offer puts the transaction value for Wyndham, the larger of the two chains, at about $8 billion.
“While we would like to come to a negotiated agreement, the refusal of the Wyndham Board to explore a transaction has left us with no choice but to take our proposal directly to the shareholders of Wyndham,” Choice CEO Patrick Pacious said in a prepared statement. “Wyndham chose to publicly reject our final proposal without explanation even after we addressed their concerns, including additional statutory protections for their shareholders.”
Pacious said Choices continues to seek a “mutually mutually agreeable deal” and said that could still happen with the potential for “additional value being opened up if Wyndham comes back to the table.” trade and provide due diligence.”
Pacious said that the company will meet with Wyndham’s shareholders in the coming days and weeks and that the process of approving the law will begin this week.
The decision has long been trying to make a deal for Wyndham, but was stopped at arm’s length. In October Wyndham refused an unsolicited $8 billion buyout offer from Choice. At the time, Wyndham called the proposal “opportunistic” and said the company’s growth potential was undervalued. Its board of directors unanimously rejected the offer.
Wyndham Chairman Stephen Holmes said in October that Choice’s offer “regards important business, regulatory and operational risks,” and that Choice failed to address Wyndham’s concerns.
Choice said it went public with the offer after six months of negotiations. The company made a private offer to Wyndham in mid-November that included $49.50 in cash and 0.324 shares of Choice stock for each share of Wyndham stock. Wyndham also offered two seats on the company’s combined board. Wyndham rejected the offer made last month.
Choice said Tuesday it is still willing to offer two seats on the company’s board of directors, with a salary cap consistent with the terms of its November proposal.
Wyndham, which is based in Parsippany, New Jersey, said in a release Tuesday that its board of directors will consider Choice’s offer to secure a actions that are considered best for the company and its shareholders.
Wyndham is urging its shareholders not to take any action until the Board of Directors makes its recommendation.
The exchange offer expires on March 8, 2024 unless extended or terminated. Choice said it intends to complete the transaction within a year.
Choice said it currently owns approximately 1.5 million shares of Wyndham Hotels & Resorts Inc.’s stock. it is worth more than $110 million. A slate of directors is scheduled to be elected to Wyndham’s board of directors at Wyndham’s 2024 annual meeting of stockholders.
Wyndham reported a profit of $355 million last year on revenue of $1.5 billion.
Hotels have seen a boom in business over the past few years. An increase in travel has led to it haunted airport and lack of pilots. It’s a bit colder this year because there are more people expensive about their travels because of the economy and after spending freely for more than a year.
Choice Hotels International Inc., based in Rockville, Maryland, operates about 7,500 hotels in 46 countries. It is trying to use a larger chain than Wyndham, which operates more than 9,000 hotels including Howard Johnson, Super 8 and Travelodge.