Tag Archives: wyndham

La Quinta Selling Operating Business to Wyndham Worldwide After Spinoff of Property

After announcing plans a year ago to divide its hotel organisation into different companies, Blackstone-controlled La Quinta Holdings Inc. (NYSE: LQ)reached an offer this week to offer its hotel franchise and management organisations to Wyndham Worldwide Corp. (NYSE: WYN) for $ 1.95 billion.

As part of the arrangement, instantly prior to the sale La Quinta will spin off its owned real estate assets into a publicly-traded REIT to be called CorePoint Accommodations. The company’s owned and franchised portfolio currently consists of more than 880 hotel homes with about 87,500 rooms in 48 U.S. states, Canada, Mexico and Honduras.

Wyndham hopes the addition of La Quinta will expand its reach further into the fast-growing upper-midscale hotel section.

Wyndham’s Hotel Group is among the world’s largest and most varied hotel business based on variety of residential or commercial properties. With the acquisition of La Quinta’s asset-light, fee-for-service business consisting of almost 900 managed and franchised hotels, Wyndham Hotel Group will span 21 brand names and over 9,000 hotels across more than 75 nations.

“La Quinta will instantly turn into one of our flagship brands,” said Geoff Ballotti, president and CEO of Wyndham Hotel Group. “It is an exceptionally strong brand name that is led by service-minded associates who provide some of the greatest customer engagement levels in our market.”

Keith Cline, president and CEO of La Quinta, will serve in the same role at CorePoint Lodging.

“As we prepared for, the separation of our businesses is enabling greater strategic clarity and enabling our business to benefit from development chances that naturally circulation from each service model,” Cline stated. “The midscale and upper midscale sections are among the largest in the accommodations industry in regards to number of homes and designers – not unexpected provided the cash-on-cash returns. As a pure-play accommodations realty business with a portfolio focused in these highly preferable segments, there is a considerable chance to drive worth for CorePoint.”

Barclays is functioning as exclusive financial consultant and Kirkland & & Ellis LLP is functioning as legal consultant to Wyndham Worldwide. Barclays and Deutsche Bank are supplying dedicated financing to Wyndham Worldwide in connection with the transaction.

J.P. Morgan is acting as unique financial consultant and Simpson Thacher & & Bartlett LLP is functioning as legal consultant to La Quinta. J.P. Morgan is offering committed financing to CorePoint Lodging in connection with the deal.

Wyndham Worldwide Splitting Hotel and Timeshare Companies into Separate Publicly Traded Companies

Wyndham Hotel Group to Become Pure-Play Hotel Business; Wyndham Vacation Ownership Will Be World’s Largest Publicly Traded Timeshare Business

Wyndham Worldwide (NYSE: WYN) ended up being the latest hospitality firm to spin off separate company systems in a quote to enhance shareholder value.

The company announced that Wyndham Hotel Group, based in Parsippany, NJ, will become a brand-new, openly traded pure-play hotel business, while Orlando-based Wyndham Getaway Ownership, one of largest publicly traded timeshare business, will be combined with Wyndham Destination Network, the home of timeshare exchange business RCI, as a separate time-share company.

The corporate names of the post-spinoff public companies have not yet been decided. Wyndham also announced it prepares to shop its European hotel brands independently.

Wyndham’s brands vary from the spending plan Knights Inn, Super8 and Travellodge to the upscale Wyndham Grand and Dolce Hotels and Resorts.

“After a comprehensive evaluation procedure, the board of directors has figured out that a spin-off of the hotel service and the combination of Wyndham Vacation Ownership with RCI is the best structure to unlock shareholder worth and allow strong development across the businesses,” stated Stephen P. Holmes, chairman and CEO, Wyndham Worldwide.

The deal, which is anticipated to be tax-free to Wyndham Worldwide and its shareholders, will be made by means of a pro rata distribution of the new hotel business’s stock to existing Wyndham Worldwide shareholders. Wyndham Worldwide anticipates the transaction to be completed in the very first half of 2018.

As two separate public business, the getaway ownership business and the hotel company will have different boards of directors. Holmes will act as non-executive chairman of the board for both companies.

Geoff Ballotti, current CEO of Wyndham Hotel Group, will continue to lead the hotel business as president and CEO. Michael Brown, present CEO of Wyndham Holiday Ownership, will continue to lead the timeshare business as president and CEO.

Wyndham Hotel Group has a global portfolio of 18 hotel brand names and more than 8,100 hotels with around 705,700 spaces. The business published 2016 earnings of $1.3 billion.

Wyndham Holiday Ownership has more than 220 time-share homes situated throughout the USA, Canada, Mexico, the Caribbean, South America and the South Pacific. It created more than $2 billion in gross timeshare sales in 2016. The RCI timeshare exchange network has more than 4,300 affiliated residential or commercial properties.