Choice Hotels expects Wyndham to return to the negotiating table

Choice's hostile play to buy the much larger Wyndham is shaping up to be a classic merger barnburner

Greater scale would give the combined company more than 16,800 locations worldwide, 160 million loyalty members, and $150 million in cost synergies, Choice says. The combination would allow the new entity to better compete with behemoths Marriott and Hilton for economy and business travelers.

Key takeaways

• After months of discussions on a combination, which began in April according to documents, Choice went public on Tuesday with its bid to purchase Wyndham after talks broke down several weeks ago;
• While the deal makes sense on paper - and comes after Choice's successful integration of its $675 million Radisson hotel deal in 2022 - Wyndham isn't interested ... at least at the current price;
• Wyndham believes it has consistently produced better revenue growth and margins than Choice Hotels, among other nuances. Moreover, Wyndham is concerned about the debt needed to fund the deal and heightened regulatory scrutiny.

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