The Asian American Hotel Owners Association (AAHOA), representing a substantial majority of U.S. hotel owners, with nearly 20,000 members owning over 60% of the nation’s hotels, has expressed deep concern over reports of Choice Hotels International‘s intention to acquire Wyndham Hotels & Resorts.
A merged entity resulting from this acquisition would boast 16,500 hotels and 46 brands, establishing dominance in the economy/limited service segment.
Chairman Bharat Patel highlighted the significance for AAHOA Members, stating, “To have one Franchisor Choice Hotels control so many economy and limited service hotels will give our members little opportunity to have a say in whether the franchise mandates and requirements are fair, and significantly limit their options to find a different brand under which they could successfully operate their hotels.”
The potential merger has sparked unease and fear among AAHOA members, with President and CEO Laura Lee Blake expressing, “Our AAHOA Members fear a significant further dilution of the brands, and fighting over the guest reservations on one reservation system. The changes can be highly disruptive to their business practices, and even cause a significant decrease in revenues overall.”
Reports indicate that Wyndham’s Board unanimously rejected Choice’s unsolicited stock-and-cash proposal valued at $90 per share, with 45 percent in stock and 55 percent in cash. The Board determined that accepting the proposal was not in the best interest of shareholders.
“We support Wyndham’s rejection of this proposal,” stated Blake, adding, “We further call on the federal agencies, including the Federal Trade Commission (FTC), to do a thorough investigation to fully protect competition in this segment of the industry.”