Choice Hotels Initiates $8 Billion Hostile Takeover Bid for Wyndham, Pursuing Merger Amid Rebuffs

Updated posts 2026

Choice Hotels embarks on a bold move by launching a hostile takeover bid for Wyndham Hotels & Resorts after facing repeated rejections in their attempts to strike a deal with the rival chain.

The recent offer, reiterated by Choice Hotels on Tuesday, remains unchanged from their prior bid—$49.50 in cash and 0.324 shares of Choice common stock per Wyndham share. This offer grants Wyndham shareholders the flexibility to opt for all cash, all shares, or a mix of both, amounting to an estimated $8 billion in value for the deal.

Going hostile means bypassing the board entirely and taking the offer straight to shareholders, who can tender their shares regardless of what management recommends. It is a rare step in any industry because it poisons the relationship between the two sides and often triggers defensive measures from the target. Repeating an offer that has already been turned down, without raising it, signals confidence that Wyndham’s investors value the deal more highly than its directors do.

Patrick Pacious, CEO of Choice Hotels, expressed regret at resorting to this move, stating, “While we would have preferred a negotiated agreement, the Wyndham Board’s refusal to engage has compelled us to directly approach Wyndham’s shareholders.” Pacious highlighted their efforts to address Wyndham’s concerns, including incorporating substantial regulatory protections for shareholders, before proceeding with this aggressive bid.

Choice Hotels has persistently pursued a deal with Wyndham, facing rejection at every turn. In October, Wyndham dismissed an $8 billion buyout offer from Choice, labeling it as “opportunistic” and asserting that it undervalued the company’s potential for growth. The proposal was unanimously rejected by Wyndham’s board, with Chairman Stephen Holmes citing concerns about business, regulatory, and execution risks inherent in Choice’s bid.

Despite six months of negotiations, Choice Hotels chose to go public with the bid after failing to resolve differences with Wyndham. Wyndham, managing brands like Days Inn, La Quinta, Ramada, and others, has remained tight-lipped in response to the recent contact from The Associated Press.

The exchange offer is slated to conclude on March 8, 2024, unless extended or terminated before that date. Choice Hotels currently holds over 1.5 million shares of Wyndham Hotels & Resorts Inc., valued at more than $110 million.

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Rockville-based Choice Hotels International Inc. oversees approximately 7,500 hotels across 46 countries. Their pursuit of a merger with Wyndham, a significantly larger chain with nearly 9,300 hotels encompassing brands like Howard Johnson, Super 8, and Travelodge, signals a strategic move to expand their market presence.

Also read: New York City’s Four Seasons Hotel on 57th Street is Offering Housing to Doctors and Nurses Fighting COVID-19

Learning Points:

1. Negotiation and Persistence: The article underscores the importance of persistence in negotiations. Despite facing repeated rejections, Choice Hotels continued its pursuit of a deal with Wyndham, showcasing the significance of perseverance in business negotiations and deal-making.
2. Strategic Decision-Making: The bid signifies strategic decision-making by Choice Hotels. Pursuing a larger rival like Wyndham demonstrates a strategic move to expand market share and potentially gain a competitive edge in the hotel industry.
3. Risk Assessment and Mitigation: The rejection of the bid due to concerns about risks—both business and regulatory—highlights the critical aspect of thoroughly assessing and mitigating risks in any proposed merger or acquisition. It emphasizes the need for companies to address and alleviate concerns to increase the chances of a successful deal.
4. Shareholder Engagement and Communication: The article showcases the importance of engaging and communicating with shareholders. Choice Hotels’ decision to approach Wyndham’s shareholders directly signifies the role of shareholder support in such corporate endeavors.
5. Market Expansion and Growth Strategies: The bid represents a growth strategy for Choice Hotels. Attempting to merge with a larger chain like Wyndham reflects a strategic move to expand their reach and market presence, illustrating the importance of strategic alliances and expansion for business growth.