ROCKVILLE, Maryland— Choice Hotels International recently announced it will acquire the franchise business, operations and intellectual property of Radisson Hotel Group Americas for approximately $675 million.
The addition of Radisson’s nine hotel brands in the Americas is the latest step in Choice’s strategy to expand its growth opportunities by bringing the company’s franchising platform to adjacent hotel segments and to a new set of hotel owners. The 624 Radisson hotels with over 68,000 rooms expands Choice Hotels’ presence in the upscale and core upper-midscale hospitality segments, particularly in the West Coast and Midwest regions.
The acquisition extends Choice Hotels’ customer reach in the upscale segments, as well as to more business travelers and a broader demographic within Choice’s core leisure segment. The combination strengthens Choice’s ability to provide a more holistic product offering across segments and continue to capitalize on consumer trends expected to fuel future demand for travel, such as remote work, increasing retirements and road trips.
The transaction brings Choice’s RevPAR (revenue per available room) growth performance to a new set of franchisees and hotel investors and provides new growth opportunities to expand Choice Hotels’ presence to additional locations in Canada, Latin America and the Caribbean. Consistent with Choice Hotels’ long-term strategy of growing in higher revenue segments, the Radisson brands typically have larger room counts and are located in higher RevPAR markets, driving higher royalty revenue per hotel.
Choice Hotels President and CEO Patrick Pacious said the transaction “brings together two highly complementary businesses, enhancing our guest offerings in the core upper-midscale hospitality segments, while extending our reach into the upper upscale and upscale full-service segments and in higher revenue geographic markets. We are confident that guests and franchisees will significantly benefit by combining these two exceptional sets of brands.”
Radisson Hotel Group Americas comprises operations of Radisson Hotels in the United States, Canada, Latin America and the Caribbean, and includes 10 Radisson Blu hotels, 130 Radisson hotels, nine Radisson Individuals, one Park Plaza hotel, four Radisson RED hotels, 453 Country Inn & Suites by Radisson and 17 Park Inn by Radisson hotels, as well as the Radisson Inn & Suites and Radisson Collection brands.
Choice Hotels will independently own and control the brands in the Americas and will work with the Radisson Hotel Group to drive the growth, continuity and success of the brands. The transaction is not anticipated to change Choice Hotels’ current capital allocation strategy related to dividend payment policy and planned share repurchases. The transaction is expected to close in the second half of 2022, pending regulatory approvals and customary closing requirements.
For more information, visit choicehotels.com or radissonhotelsamericas.com.
