Is Choice Hotels aiming to buy Wyndham?
Choice Hotels International (CHH.N) is seeking to buy Wyndham Hotels & Resorts (WH.N) in a deal that would create a U.S. budget hotel giant, a person familiar with the matter told Reuters on Tuesday.
The talks between the companies are at an early stage and it is not clear whether Wyndham is interested in pursuing a tie-up with Choice, the source said, requesting anonymity as these discussions are confidential.
If Wyndham decides not to proceed with a deal, Choice Hotels could choose to go hostile and take an offer directly to Wyndham's shareholders, the source said.
News of the potential deal comes at a time when high inflation and recession risks could sap consumer spending on travel and drive up demand for affordable hotels such as Choice and Wyndham.
The news was first reported by the Wall Street Journal on Tuesday, after which shares of Wyndham Hotels closed 5.1% higher, while Choice Hotels ended about 4.6% lower.
