Choice Hotels International is urging Wyndham Hotels & Resorts stockholders to tender their shares in Choice's exchange offer by 8 March 2024.
Choice believes this will encourage Wyndham's board to engage in constructive discussions towards a mutually beneficial agreement.
The multinational hospitality company launched the tender offer in December 2023 to directly involve Wyndham stockholders and initiate regulatory approval processes. They have addressed regulatory concerns, offered significant protections for Wyndham, and claim to have received positive feedback from many Wyndham shareholders who support exploring a potential transaction.
Choice maintains that its $90 per share offer is a compelling value proposition, exceeding Wyndham's independent performance. However, the company expressed frustration with Wyndham's refusal to engage in discussions or provide information that could potentially improve the offer.
While committed to the transaction, Choice's ability to further enhance the offer without proper access to information is limited, considering Wyndham's recent financial results.
Choice re-iterates its belief that a combined company would significantly benefit all stakeholders, including stockholders, franchisees and guests, and gain regulatory approval within a reasonable timeframe. It urges Wyndham stockholders to tender their shares, emphasising it does not obligate them to accept the current offer. Shareholders retain the right to withdraw tendered shares if the offer is extended.
The company had declared that it will decide whether to extend or terminate the offer based on stockholder participation by the deadline of 8 March 2024. It will also evaluate next steps regarding its previously announced nomination of independent directors for Wyndham's board.
Throughout 2023, the potential merger between Choice and Wyndham created waves of anticipation. The saga, marked by multiple proposals and rejections, sheds light on the complexities of deal-making amid economic uncertainties.
The prolonged negotiations underscore the careful considerations and concerns of both parties, reflecting the broader industry’s cautious approach amid concerns about high inflation and the possibility of a recession impacting consumer spending on travel.
Wyndham rejected Choice’s latest offer in December 2023. Major concerns highlighted by the Wyndham board were regulatory risks and uncertain outcome, antitrust risks and business disruption, and inadequate valuation and growth potential.
In January 2024, in a bid to address growing concerns surrounding its proposed acquisition of Wyndham, Choice released a comprehensive investor presentation. The move came in response to what Choice perceives as a disinformation campaign initiated by Wyndham, attempting to raise antitrust alarms.
The presentation emphasised Choice’s commitment to regulatory compliance and claimed that the company is proceeding as expected in the regulatory review process with the US Federal Trade Commission.
