Announces Expiration of Exchange Offer and
Withdrawal of Independent Director Candidates for Election
at Wyndham's 2024 Annual Meeting
Increases Share Repurchase
Authorization
Projects to Continue Delivering Strong
Earnings Growth
NORTH BETHESDA, Md.,
March 11,
2024 /PRNewswire/ -- Choice Hotels International,
Inc. (NYSE: CHH) (the "Company" or "Choice") today announced the
expiration of the exchange offer to acquire all of the issued and
outstanding shares of Wyndham Hotels & Resorts, Inc. (NYSE: WH)
("Wyndham"). The Company is also withdrawing its nomination of the
highly qualified, independent director candidates for election at
Wyndham's 2024 Annual Meeting of Stockholders. The Company further
announced that its Board of Directors has approved an increase in
the number of shares authorized under its share repurchase program
by five million shares. When added to the remaining number of
available shares previously authorized for repurchase, this results
in a total authorization of approximately 6.8 million shares.
The Company today issued the following statement:
Since beginning this process in April 2023, Choice has attempted to engage in
good-faith negotiations with Wyndham through numerous different
avenues, including increasing the proposed offer multiple times and
expressing an openness to further enhancing the offer with due
diligence, offering a one-way NDA to share its confidential
information with Wyndham, and offering above-market regulatory
protections. Given Wyndham's refusal to constructively and
substantively engage on terms, Choice took the extraordinary step
of launching the exchange offer to initiate the regulatory review
process and engage with Wyndham 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. As
such, Choice has decided not to extend the exchange offer and is
withdrawing its slate. Choice intends to continue focusing on its
standalone strategy, which the Company is confident will create
significant long-term value for its stockholders and
franchisees.
Choice has a long history of delivering above
average returns, is excited by the significant runway for growth
grounded in its current business strategy and has always been
disciplined in how it allocates capital. Choice's Board of
Directors and management team are enthusiastic about the Company's
go-forward strategy, which is expected to deliver another year of
superior growth with projected adjusted EBITDA increasing
approximately 10% at the midpoint of guidance, driven by:
-
- Choice's unique revenue intense strategy delivering accelerated
unit growth and higher royalty revenue per hotel.
- Choice's continued realization of the higher-than-expected
synergies resulting from the Radisson Americas business
integration.
- Choice's platform earnings potential, highlighted by the
significant outperformance of the co-brand credit card program
launched in April.
- Choice's continued international business earnings growth and
global pipeline expansion.
The progress made on the regulatory front
confirmed Choice's belief that the combination is pro-competitive,
and approval would have been achievable in a customary timeframe.
Choice thanks the stockholders and franchisees from both companies
for their significant support in this process. Choice also thanks
the independent director candidates it nominated for their time,
effort and commitment to act in the best interests of the
Wyndham stockholders.
The exchange offer expired on March 8,
2024. No shares of Wyndham stock were purchased by WH
Acquisition Corporation, a wholly owned subsidiary of Choice,
pursuant to the exchange offer. Choice decided not to accept any
shares pursuant to the offer due to a number of factors, including
the refusal of the Wyndham board to engage in constructive
discussions on terms and the fact that a number of the conditions
to the offer, such as the minimum tender condition, remained
unsatisfied as of the expiration date. Choice has instructed the
exchange agent for the exchange offer to promptly return all
tendered shares of Wyndham stock to the tendering stockholders.
About Choice Hotels®
Choice Hotels International, Inc. (NYSE: CHH) is one of the
largest lodging franchisors in the world. The challenger in the
upscale segment and a leader in midscale and extended stay,
Choice® has nearly 7,500 hotels, representing almost
630,000 rooms, in 46 countries and territories. A diverse portfolio
of 22 brands that range from full-service upper upscale properties
to midscale, extended stay and economy enables Choice®
to meet travelers' needs in more places and for more occasions
while driving more value for franchise owners and shareholders. The
award-winning Choice Privileges® rewards program and
co-brand credit card options provide members with a fast and easy
way to earn reward nights and personalized perks. For more
information, visit www.choicehotels.com.
Forward-looking Statements
Information set forth herein includes "forward-looking
statements." Certain, but not necessarily all, of such
forward-looking statements can be identified by the use of
forward-looking terminology, such as "expect," "estimate,"
"believe," "anticipate," "should," "will," "forecast," "plan,"
"project," "assume," or similar words of futurity. All statements
other than historical facts are forward-looking statements. These
forward-looking statements are based on management's current
beliefs, assumptions, and expectations regarding future events,
which in turn are based on information currently available to
management. Such statements may relate to projections of Choice's
revenue, expenses, EBITDA, adjusted EBITDA, earnings, debt levels,
ability to repay outstanding indebtedness, payment of dividends,
repurchases of common stock and other financial and operational
measures, including occupancy and open hotels, RevPAR, and Choice's
liquidity, among other matters. We caution you not to place undue
reliance on any such forward-looking statements. Forward-looking
statements do not guarantee future performance and involve known
and unknown risks, uncertainties, and other factors.
Several factors could cause actual results, performance or
achievements of the company to differ materially from those
expressed in or contemplated by the forward-looking statements.
Such risks include, but are not limited to, changes to general,
domestic and foreign economic conditions, including access to
liquidity and capital; the ability to realize the anticipated
long-term benefits and synergies of the acquisition of Radisson
Hotels Americas to the extent anticipated; changes in consumer
demand and confidence, including consumer discretionary spending
and the demand for travel, transient and group business; the timing
and amount of future dividends and share repurchases; future
domestic or global outbreaks of epidemics, pandemics (including
COVID-19) or contagious diseases or fear of such outbreaks, and the
related impact on the global hospitality industry, particularly but
not exclusively the U.S. travel market; changes in law and
regulation applicable to the travel, lodging or franchising
industries, including with respect to the status of the company's
relationship with employees of our franchisees; foreign currency
fluctuations; impairments or declines in the value of the company's
assets; operating risks common in the travel, lodging or
franchising industries; changes to the desirability of our brands
as viewed by hotel operators and customers; changes to the terms or
termination of our contracts with franchisees and our relationships
with our franchisees; our ability to keep pace with improvements in
technology utilized for marketing and reservations systems and
other operating systems; our ability to grow our franchise system;
exposure to risks related to our hotel development, financing and
ownership activities; exposures to risks associated with our
investments in new businesses; fluctuations in the supply and
demand for hotel rooms; our ability to realize anticipated benefits
from acquired businesses; impairments or losses relating to
acquired businesses; the level of acceptance of alternative growth
strategies we may implement; the impact of inflation; cyber
security and data breach risks; climate change and sustainability
related concerns; ownership and financing activities; hotel
closures or financial difficulties of our franchisees; operating
risks associated with our international operations; labor
shortages; the outcome of litigation; and our ability to
effectively manage our indebtedness and secure our indebtedness,
including additional indebtedness incurred as a result of the
acquisition of Radisson Hotels Americas. These and other risk
factors that may affect Choice's operations are discussed in detail
in the company's filings with the U.S. Securities and Exchange
Commission, including the company's Annual Report on Form 10-K. We
undertake no obligation to publicly update or revise any
forward-looking statement, whether as a result of new information,
future events or otherwise, except as required by law.
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SOURCE Choice Hotels International, Inc.