US hospitality chain Wyndham Worldwide has announced that it has agreed to acquire the hotel franchise and hotel management business of La Quinta in a deal just short of £2bn.
The transaction will see Wyndham paying a price of $8.40 per La Quinta share, at a total aggregate of $1bn. Further, Wyndham will pay off the La Quinta’s outstanding $715mn in debt, whilst also setting aside $240mn for the taxes that it expects to incur as a result of the acquisition.
“La Quinta will immediately become one of our flagship brands,” said Geoff Ballotti, President and Chief Executive Officer of Wyndham Hotel Group. “It is an exceptionally strong brand that is led by service-minded associates who deliver some of the highest customer engagement levels in our industry.”
Wyndham will acquire approximately 900 managed and franchised hotels in the deal, expanding its existing portfolio to 9,000 hotels and 21 brands across 75 different countries.
“We are excited to announce the addition of the La Quinta franchise and management businesses to Wyndham Hotel Group’s portfolio,” said Keith Cline, President and CEO of La Quinta. “We believe that, under the management of Wyndham’s seasoned team of executives, the La Quinta portfolio will grow and thrive, yielding long-term benefits to the stakeholders of both companies.”
The transaction is expected to complete in Q2 2018, having been approved by the Board of Directors of both companies.