UPDATE: Oct. 17, 2023: Wyndham released a statement saying its Board of Directors “unanimously rejected” Choice’s proposal.
Choice Hotels International announced a proposal to acquire Wyndham Hotels & Resorts Tuesday morning.
Choice is offering $90 per share for all outstanding Wyndham shares, payable in a mix of cash and stock.
In its announcement, Choice said it is making its proposal public following Wyndham’s “decision to disengage from further discussions with Choice.” The company says the two parties held nearly six months of dialogue.
“A few weeks ago, Choice and Wyndham were in a negotiable range on price and consideration, and both parties have a shared recognition of the value opportunity this potential transaction represents,” said Choice President and CEO Patrick Pacious in a statement.
“We were therefore surprised and disappointed that Wyndham decided to disengage. While we would have preferred to continue discussions with Wyndham in private, following their unwillingness to proceed, we feel there is too much value for both companies' franchisees, shareholders, associates, and guests to not continue pursuing this transaction.”
In May, the Wall Street Journal reported that Choice was seeking to buy Wyndham, but neither company confirmed the report at the time, and experts remained skeptical about the deal.
Pacious said a potential acquisition would bring Choice’s “proven franchisee success system” to more owners, and that business and leisure travelers could benefit from a combined rewards program.
In the announcement, Choice also detailed potential added shareholder value, improved options for guests seeking value, better job stability and opportunities for associates and lower total costs of ownership for franchisees.
The announcement also detailed a negotiations timeline that was previously kept under wraps.
In the announcement, Choice revealed that it initially sent a letter to Wyndham regarding a potential transaction in April, valued at $80 per share. Since then, Choice has increased its proposed purchase price to $85 and later to $90 per share, where it currently stands.
The announcement also includes the text of a letter from Pacious to Wyndham’s Board of Directors, sent Aug. 21.
“We urge you to accept our offer and engage with us and our advisors openly and without delay so that we can advance a dialogue for the mutual benefit of our respective shareholders,” Pacious wrote.
Wyndham did not immediately respond to Hotel Dive’s request for comment.
