U.S. hotel operator Wyndham Worldwide said on Thursday it would acquire La Quinta’s hotel franchise and management businesses for $1.95 billion in cash, expanding its midscale presence amid increasing travel demand.
La Quinta shareholders will receive $8.40 per share in cash and Wyndham will repay about $715 million of La Quinta debt net of cash.
Ahead of the acquisition, La Quinta will spin off its real estate assets into a publicly-traded real estate investment trust, CorePoint Lodging Inc.
Wyndham, whose brands include Ramada, Days Inn, Super 8, Howard Johnson and Wingate by Wyndham, said it would set aside a reserve of $240 million for estimated taxes as part of La Quinta’s spin-off of its real estate assets.
The deal is expected to close in the second quarter of 2018, Wyndham said.
