Wyndham Hotels & Resorts: Choice Hotels (CHH) launches exchange offer to acquire all outstanding shares of Wyndham Hotels & Resorts (79.56)
- Choice Hotels International, Inc. (CHH) announced that it is commencing an exchange offer to acquire Wyndham Hotels & Resorts, Inc. (WH) in order to present its compelling proposal directly to Wyndham shareholders. Choice continues to believe that a transaction with Wyndham is pro-competitive and would generate value for both Wyndham and Choice shareholders as well as deliver significant benefits to franchisees, guests and associates of both companies.
- The exchange offer maintains the previously proposed offer to Wyndham, comprised of $49.50 in cash and 0.324 shares of Choice common stock per Wyndham share, representing a value of $40.50 based on Choice's trading price as of October 16, 2023, the day prior to Choice's first public offer (the "Pre-Release Date"). As of the Pre-Release Date, the proposed offer price equates to a 30% premium to Wyndham's closing share price of $69.10, and reflects a 14.9x multiple of Wyndham's consensus 2023 adjusted EBITDA estimate, a forward multiple Wyndham has never achieved, absent COVID disruptions.
- The exchange offer provides Wyndham shareholders the opportunity to elect to receive the consideration in all cash, all shares or a combination of cash and shares, subject to a customary proration mechanism. In addition, the exchange offer features a regulatory ticking fee of $0.45 per Wyndham share per month, equivalent to $38 million per month, accruing daily after the one-year anniversary of the date a majority of Wyndham's shares are tendered into the offer. This additional consideration, which has been included so that Wyndham shareholders can receive benefits similar to what Choice previously offered in its November 14, 2023 proposal in the unlikely event the transaction were to take longer than 12 months to close, would be payable in cash or stock, at Choice's election, upon Choice's acceptance and exchange of the Wyndham shares tendered into the offer.