Choice Hotels scraps US$9b bid for Wyndham
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The news: Choice Hotels International announced that its offer to acquire its rival Wyndham Hotels & Resorts had expired, after an almost 12 month effort to complete the hostile takeover.
The numbers: The offer from Choice valued Wyndham at USD7 billion ($10.61 billion) on current prices, and USD9 billion including debt, expired on Friday. The deal would have created one of the largest budget hotel chains in the country, with almost 1.5 million rooms.
The context: The Wyndham board refused Choice’s offers several times during negotiations, citing regulatory risk, the equity component of past offers and that Choice’s offers undervalued Wyndham’s prospects.
In its announcement, Choice criticised Wyndham’s refusal to “constructively and substantively engage on terms” during the negotiations and that it will now focus on its strategy as an independent operator. Choice also announced that its board has approved its share buyback program by 5 million shares, roughly USD600 million.
The sources: Choice Press Release, Wall Street Journal
