Choice Hotels International, Inc. (NYSE: CHH) has recently provided an update on its exchange offer and proposal to acquire Wyndham Hotels & Resorts, Inc. (NYSE: WH). The company has announced the expiration of the exchange offer and the withdrawal of its independent director candidates for election at Wyndham's 2024 annual meeting. Additionally, Choice Hotels has increased its share repurchase authorization.
The board of directors at Choice Hotels has approved an increase in the number of shares authorized under its share repurchase program by five million shares, resulting in a total authorization of approximately 6.8 million shares.
Since the beginning of the acquisition process in April 2023, Choice Hotels has made several attempts to engage in negotiations with Wyndham, including increasing the proposed offer multiple times. However, due to Wyndham's refusal to engage constructively, Choice Hotels has decided not to extend the exchange offer and is withdrawing its slate. The company intends to focus on its standalone strategy, confident that it will create significant long-term value for its stockholders and franchisees.
Despite the challenges in the acquisition process, Choice Hotels remains optimistic about its go-forward strategy. The company projects a strong earnings growth, with projected adjusted EBITDA increasing approximately 10% at the midpoint of guidance. This growth is expected to be driven by various factors, including Choice's unique revenue intense strategy, the realization of higher-than-expected synergies from the Radisson Americas business integration, platform earnings potential, and continued international business earnings growth.
The exchange offer expired on March 8, 2024, and no shares of Wyndham stock were purchased by WH Acquisition Corporation, a wholly owned subsidiary of Choice Hotels, pursuant to the exchange offer.
Today the company's shares have moved 5.0% to a price of $127.09. For the full picture, make sure to review Choice Hotels International's 8-K report.
