Choice Hotels International Inc. has urged the stockholders of Wyndham Hotels & Resorts Inc. to tender their shares into the exchange offer ahead of its expiration at 5:00 p.m. ET on March 8.
According to Choice, tendering shares will send a clear message to Wyndham’s board of directors to constructively engage with the ​company to reach a consensual agreement on the terms of a transaction. Depending on participation, Choice intends to either extend or terminate the exchange offer and will evaluate next steps related to its nomination of a slate of independent directors for election to the board of directors of Wyndham.
Choice launched the exchange offer in December to take the proposed transaction directly to Wyndham’s stockholders and begin the regulatory approval process. Over the past several months, Choice has made progress in addressing regulatory requests and offered above-market regulatory protections, including a significant reverse termination fee and ticking fee. According to Choice, the company has also spoken to the holders of a significant number of Wyndham’s shares, and the feedback from stockholders is that they would like to see Choice and Wyndham genuinely explore a value-maximizing transaction in a constructive manner. Wyndham has been unwilling to provide any feedback on specific transaction terms that its board might find acceptable.
Choice continues to believe its current offer reflects a fulsome value, and the proposed value of $90 per share represents a multiple far in excess of what Wyndham has been able to achieve as a standalone business. In addition, and as Choice has stated before, Wyndham has refused to provide Choice access to any information that may have resulted in Choice’s ability to improve its offer. While Choice is committed to the transaction and would like to work expeditiously to deliver a value-maximizing transaction to Wyndham stockholders, Wyndham’s recent quarterly results give Choice limited confidence in further enhancing its proposal without proper due diligence.
Choice remains steadfast in its belief that a combination offers a compelling value to all stockholders, benefits franchisees and guests, and will receive regulatory approvals within a one-year customary timeframe.
It should be noted that tendering shares into the offer does not obligate Wyndham stockholders to accept the current Choice offer. Holders may immediately withdraw any shares tendered upon notice of an extension, which Choice is required to publish not later than 9:00 a.m. ET on March 11, if Choice decides to extend the offer.
A request for comment by Wyndham was not returned.
