Wyndham to Buy La Quinta for $1.95 Billion
Wyndham Worldwide Corporation [NYSE:WYN] announced this morning that it has agreed to acquire La Quinta’s hotel franchise and operations management businesses for $1.95 billion in cash.
The franchising firm watches over 900 managed and franchised hotels. The buyout is expected to be completed in the second quarter of this year upon the successful spin-off of La Quinta’s real estate assets into a separate entity.
Wyndham will now have over 9,000 hotels that fly its 21 brands, including La Quinta, across more than 75 countries.
Under the terms of the agreement, La Quinta stockholders will receive $8.40 per share, or nearly $1 billion in the aggregate. In addition, Wyndham will repay roughly $715 million of La Quinta’s debt net of cash, as well as set aside a reserve of $240 million for anticipated taxes to be incurred in connection with the spin-off of the real estate business.
In connection with the acquisition and spin-off, La Quinta also announced today that Keith A. Cline has been appointed president and chief executive officer of the anticipated publicly traded real estate investment trust company, CorePoint Lodging Inc., a position that will officially be in place upon completion of the planned spin-off.
Cline stated, "As we anticipated, the separation of our businesses is enabling greater strategic clarity and allowing our company to take advantage of growth opportunities that naturally flow from each business model. To that end, we are excited to announce the addition of the La Quinta franchise and management businesses to Wyndham Hotel Group's portfolio. 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."