Wyndham further revealed that the proposal carried an ominous “extended regulatory timeline and uncertainty of outcome, potential franchisee churn, and excessive leverage levels at the pro forma combined company.”
Wyndham Rejects $7.8B Offer : The Best and Final Play
In an unexpected twist, Choice Hotels had made their ‘best and final offer,’ implicitly valuing Wyndham at a colossal $7.8 billion, with the stakes rising to a staggering $9.8 billion when accounting for the assumption of Wyndham’s net debt. The grandeur of the proposal was undeniable.
Choice Hotels expressed their disappointment in Wyndham’s abrupt decision to sever negotiations. It was a perplexing turn of events, considering that just a few weeks prior, both parties were seemingly on the same page, huddled together in a negotiable range on price and considerations.
A Long and Tumultuous Courtship
The courtship between the two giants had started months ago, with Choice sending its initial letter to Wyndham in April, offering $80 per share, featuring a tempting cocktail of 40% cash and 60% Choice stock. This initial offer was met with rejection and a clear refusal to engage in further talks.
