= La Quinta Holdings (NYSE: LQ) to be acquired by Wyndham Worldwide (WYN) for $1.95 billion

La Quinta Holdings Inc. owns, operates, and franchises select-service hotels.
Sector: Consumer Cyclical
Industry: Resorts & Casinos
Full Time Employees: 6,944
Founded: 1968
Headquartered: Irving, Texas
http://www.lq.com

• The acquisition will help Wyndham to significantly improve its hotel management business and strengthen its brand presence globally. La Quinta has an asset-light, fee-for-service business structure, which consists of nearly 900 managed and franchised hotels. On the flipside, Wyndham operates a portfolio of 20 lodging brands and has approximately 9,000 hotels across 80 countries and six continents.

Irving-based La Quinta announced Thursday a $1.95 billion cash deal with Wyndham (NYSE: WYN), expected to close in the second quarter. Both companies’ boards have already approved the transaction.

Under the agreement, La Quinta stockholders will receive $8.40 per share in cash, an aggregate of roughly $1 billion. Wyndham has agreed to pay down $715 million of La Quinta’s net debt out of cash.

Additionally, New Jersey-based Wyndham will set aside $240 million for taxes expected to be incurred as La Quinta’s corporately-owned assets form a new publicly-traded real estate investment trust to be called CorePoint Lodging.

In return, Wyndham will acquire 900 managed and franchised hotels. This will bring its portfolio to 21 brands and over 9,000 properties in more than 75 countries.

"La Quinta will immediately become one of our flagship brands," Geoff Ballotti, president and CEO of Wyndham Hotel Group, said in a prepared statement. "We expect that La Quinta guests and franchisees will benefit from our intense focus on product quality and our best-in-class technology, digital, loyalty and distribution platforms. This acquisition also significantly expands our hotel management business and provides us with substantial new opportunities to drive increased growth in our business."

Prior to the Wyndham deal, La Quinta’s corporate assets will be spun off into CorePoint, which will be lead by La Quinta’s current president and CEO Keith Cline. The REIT will own 315 hotels and more than 40,000 rooms in the U.S.