OYO Expands Horizons with Acquisition of G6 Hospitality

OYO's Strategic Acquisition of G6 Hospitality

In a significant move, Oravel Stays, the parent company of OYO, has announced the acquisition of G6 Hospitality from Blackstone Real Estate for $525 million. This all-cash transaction is set to bolster OYO's footprint in the U.S. hospitality sector.

Expanding Presence in the U.S.

Since its entry into the U.S. market in 2019, OYO has progressively expanded, now operating over 320 hotels across 35 states. The company plans to increase its U.S. hotel portfolio by adding approximately 250 properties in 2024, building upon the nearly 100 hotels it added in the previous year. With the acquisition of G6, OYO seeks to tap into the robust franchise network of Motel 6, which generates gross room revenues of $1.7 billion, thus presenting a strong cash flow and fee base.

The Vision Behind the Acquisition

Gautam Swaroop, the CEO of OYO International, expressed that this acquisition not only strengthens their international presence but aligns well with their vision of growth. He believes Motel 6's well-established brand and financial model combined with OYO's dynamic approach will create a sustainable path forward for all parties involved.

Growth Opportunities through Enhanced Technology

OYO plans to utilize its extensive technology suite and marketing expertise to elevate the Motel 6 and Studio 6 brands. This acquisition represents a strategic initiative for OYO to integrate advanced technological solutions within the Motel 6 network, promoting efficiency and improving customer experiences.

Statements from Industry Leaders

Julie Arrowsmith, President and CEO of G6 Hospitality, highlighted the value created during Blackstone's ownership, which has enhanced the Motel 6 brand and positioned it well for future innovations under OYO's leadership. Rob Harper, Head of Blackstone Real Estate Asset Management Americas, remarked on the successful outcome for investors, indicating that G6 is poised for continued success.

The Future of the Motel 6 Brand

The transaction is expected to close in the fourth quarter of 2024, pending customary closing conditions. This acquisition allows G6 Hospitality to leverage OYO's innovative strategies while maintaining its identity as a separate entity within the broader hospitality landscape.

Goldman Sachs & Co. LLC has served as the lead advisor to Blackstone for this landmark deal, with Jones Lang LaSalle Securities, LLC and PJT Partners also providing financial advisory. Legal assistance was provided by Simpson Thacher & Bartlett LLP.

About OYO

OYO is a pioneering global platform dedicated to empowering small businesses in the hospitality sector. Through its full-stack technology products and tailored services, OYO aims to enhance operational efficiency and revenue for hotels and homes worldwide. With over 40 integrated solutions for its partners, OYO supports more than 175K hotel and home storefronts across over 35 countries.

About G6 Hospitality LLC

G6 Hospitality is a leading economy lodging franchisor, promoting hospitality through its Motel 6 and Studio 6 brands. With nearly 1,500 locations across the U.S. and Canada, G6 is passionate about providing accessible hospitality while offering franchisees opportunities to thrive. The company has been recognized for its commitment to diversity and quality service.

About Blackstone Real Estate

Blackstone continues to lead in real estate investments globally, with a capital management portfolio exceeding $336 billion. As the foremost owner of commercial real estate, Blackstone pursues well-located, undervalued assets to drive significant returns for its investors.

Frequently Asked Questions

What is the significance of OYO acquiring G6 Hospitality?

This acquisition marks a strategic expansion for OYO, enhancing its U.S. presence and market share in the economy lodging segment.

How many hotels does OYO operate in the U.S.?

Currently, OYO operates over 320 hotels across 35 states and plans to further expand its portfolio significantly.

What are the anticipated benefits for Motel 6 under OYO?

OYO intends to leverage its technology and marketing expertise to enhance brand recognition and drive financial growth for Motel 6.

When is the acquisition expected to close?

The transaction is anticipated to finalize in the fourth quarter of 2024, pending customary closing conditions.

What differentiates OYO in the hospitality market?

OYO stands out through its innovative technology solutions and commitment to providing affordable, quality accommodation worldwide.

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