Monday 04 June 2018

4 June 2018 - US-based lodging companies Wyndham Worldwide Corp. (NYSE: WYN) has closed the acquisition of US-based hotel operator La Quinta Holdings Inc.'s (NYSE: LQ) hotel franchise and hotel management businesses for USD 1.95bn in cash, the companies said.

Under the terms of the agreement, stockholders of La Quinta will receive USD 8.40 per share in cash (approximately USD 1bn in aggregate), and Wyndham Worldwide will repay approximately USD 715m of La Quinta debt net of cash and set aside a reserve of USD 240m for estimated taxes expected to be incurred in connection with the taxable spin-off of La Quinta's owned real estate assets into CorePoint Lodging Inc.

Immediately prior to the sale of La Quinta to Wyndham Worldwide, La Quinta will spin off its owned real estate assets into a publicly-traded real estate investment trust, CorePoint Lodging.

With the acquisition of La Quinta's asset-light, fee-for-service business consisting of nearly 900 managed and franchised hotels, Wyndham Hotel Group will span 21 brands and over 9,000 hotels across more than 75 countries.

The addition of La Quinta, one of the largest midscale brands in the industry, will build upon Wyndham Hotel Group's midscale presence, and expand its reach further into the fast-growing upper-midscale segment.

The La Quinta Returns loyalty programme, with its 13m enrolled members, will be combined with the award-winning Wyndham Rewards programme, with its 53m enrolled members.

Closing is subject to approval by La Quinta stockholders, regulatory and government approval and the satisfaction of other customary closing conditions.

Barclays is acting as exclusive financial advisor and Kirkland and Ellis LLP is acting as legal advisor to Wyndham Worldwide.

Barclays and Deutsche Bank are providing committed financing to Wyndham Worldwide in connection with the transaction. J.P. Morgan is acting as exclusive financial advisor and Simpson Thacher and Bartlett LLP is acting as legal advisor to La Quinta. J.P. Morgan is providing committed financing to CorePoint Lodging in connection with the transaction.