Wyndham Hotel & Resorts has rejected a $8 billion buyout attempt by Choice Hotels International.
The two companies have been negotiating since April. However, a statement from Wyndham says the company’s board of directors reviewed Choice’s “unsolicited”’ offer and determined it was not in “the best interests” of their stakeholders.
“Choice’s offer is underwhelming, highly conditional, and subject to significant business, regulatory, and execution risk. Choice has been unwilling or unable to address our concerns,”’ says Stephen P. Holmes, chair of the Wyndham board of directors and the company’s former CEO, in the statement. “While our board would support a value-maximizing transaction, given the substantial, unmitigated embedded risks and value-destruction potential presented by the proposed transaction, our board determined it is not in the best interests of Wyndham shareholders.
We are disappointed that Choice’s description of our engagement disingenuously suggests that we were in alignment on core terms and omits to describe the true reasons we have consistently questioned the merits of this combination—Choice’s inability and unwillingness to address our significant concerns about regulatory and execution risk and our deep concerns about the value of their stock,” he continues.
The full, detailed explanation of Wyndham’s issues with the offer can be found here. Choice has yet to respond publicly.
Wyndham includes brands such as Days Inn and Travelodge, operating and franchising a portfolio of 24 brands. Choice Hotels, with a portfolio including Econo Lodge, Quality Inn, and Clarion, franchises more than 7,000 hotels.
