AAHOA (Asian American Hotel Owners Association), which represents the majority of U.S. hotel owners with nearly 20,000 members owning more than 60% of all hotels in this country, expresses high concern over reports that Choice Hotels International (Choice Hotels) is seeking to purchase Wyndham Hotels & Resorts (Wyndham).
A merged company would have 16,500 hotels with 46 brands and dominate the economy/limited service segment.
"As the owners of more than two-thirds of both Choice Hotels and Wyndham-branded hotels, AAHOA Members have much at stake with Choice's potential purchase of Wyndham," said AAHOA Chairman Bharat Patel. "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."
"This news of a potential merger has sent a shock wave of high concern and even fear through our AAHOA membership," said AAHOA President and CEO, Laura Lee Blake. "We have seen in the past the major impact that mergers and acquisitions by the big hotel Franchisor corporations can have on our members as the hotelier Franchisees. Indeed, 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."
According to reports, Wyndham announced that its Board of Directors unanimously rejected a highly conditional, unsolicited stock-and-cash proposal by Choice to acquire all outstanding shares of Wyndham. Wyndham's Board carefully reviewed Choice's proposal comprising a value of
$90 per share, with 45 percent in stock and 55 percent in cash, and determined that it was not in the best interest of shareholders to accept the proposal.
"We support Wyndham's rejection of this proposal," said Blake. "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."