Choice Hotels Scraps $7 Billion Bid For Wyndham
Choice Hotels today announced the expiration of the exchange offer to acquire all of the issued and outstanding shares of Wyndham Hotels & Resorts. The exchange offer expired on March 8, 2024. No shares of Wyndham stock were purchased by WH Acquisition Corporation, a wholly owned subsidiary of Choice, pursuant to the exchange offer.
Choice launched a hostile bid in December, after Wyndham repeatedly rebuffed its approaches, saying that the offer was low-premium and fraught with antitrust risk. Wyndham also raised concerns about the combined company carrying too much debt and a slowdown in Choice’s business. Choice also nominated in January a slate of directors to replace Wyndham’s eight-member board.
Choice said in a statement that “since beginning this process in April 2023, Choice has attempted to engage in good-faith negotiations with Wyndham through numerous different avenues, including increasing the proposed offer multiple times and expressing an openness to further enhancing the offer with due diligence, offering a one-way NDA to share its confidential information with Wyndham, and offering above-market regulatory protections. Given Wyndham’s refusal to constructively and substantively engage on terms, Choice took the extraordinary step of launching the exchange offer to initiate the regulatory review process and engage with Wyndham stockholders.’
It added that “while the support from Wyndham stockholders tendering into the exchange offer was significant considering the number of investors structurally prevented from participating at this stage, it was not sufficient for Choice to conclude – particularly when taking into account the Wyndham board’s obvious continuing disinterest in a combination – that a path towards a transaction is available at this time. As such, Choice has decided not to extend the exchange offer and is withdrawing its slate. Choice intends to continue focusing on its standalone strategy, which the Company is confident will create significant long-term value for its stockholders and franchisees.”
Choice said on Monday its board had authorized an increase of 5 million shares to its repurchase program.
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