Choice Hotels has terminated its hostile takeover bid for rival US budget accommodation operator Wyndham Hotels & Resorts Inc (NYSE:WH) after failing to gain the support of Wyndham’s shareholders, the company said.
Choice went public with its cash-and-stock takeover offer in October, which was valued at about $7.8 billion. After being turned down repeatedly by Wyndham, Choice launched a hostile bid in December.
It said on Monday that its exchange offer to acquire the company had expired and it did not intend to extend it. It also said it was withdrawing its nomination of independent director candidates for election at Wyndham’s 2024 Annual Meeting of Stockholders.
“While the support from Wyndham stockholders tendering into the exchange offer was significant considering the number of investors structurally prevented from participating at this stage, it was not sufficient for Choice to conclude – particularly when taking into account the Wyndham board's obvious continuing disinterest in a combination – that a path towards a transaction is available at this time,” Choice said in a statement.
Stephen Holmes, chairman of the board at Wyndham, said the company was pleased Choice had ended its hostile pursuit and proxy contest following the expiry of its unsolicited exchange offer.
"We are confident in Wyndham's standalone strategy and growth prospects under the leadership of our proven management team,” Holmes said.
Shares of Choice traded higher on the news, up 5% at about $127, while Wyndham stock moved lower, down 0.7% at $75.57 in early trade on Monday.