Choice Hotels takes a vacation from reality

Choice Hotels International

21/11/2023 17:52

(The author is a Reuters Breakingviews columnist. The opinions
expressed are her own.)
    By Jennifer Saba
       NEW YORK, Nov 21 (Reuters Breakingviews) - The Comfort
Suites operator has taken another stab at its unsolicited and
unwelcome $9.8 bln offer for rival Wyndham. The part-shares deal
is easy to rebuff in a wobbly market where cash is king. But
switching it to cash could leave Choice with hefty debt and
unhappy customers.
    Full view will be published shortly.
    Follow @jennifersaba on X
         
    CONTEXT NEWS 
    Wyndham Hotels and Resorts said on Nov. 21 that would-be
acquirer Choice Hotels International had revised the terms of an
earlier takeover approach, but that Wyndham had rejected the new
bid.
    Choice unveiled a $90-per-share offer for Wyndham on Oct.
17, valuing the target at $9.8 billion including debt. The two
companies had been negotiating in private since April.
    The new offer includes a reverse termination fee, payable by
the buyer if the deal fails to close for regulatory reasons,
worth 6% of the purchase price.

 (Editing by John Foley and Sharon Lam)
 ((For previous columns by the author, Reuters customers can
click on  SABA/ 
jennifer.saba@thomsonreuters.com; Reuters Messaging:
jennifer.saba.thomsonreuters.com@reuters.net))