IPO-bound OYO has agreed to acquire G6 Hospitality, economy lodging franchisor and parent company of the Motel 6 and Studio 6 brands, from Blackstone Real Estate for $525 million, in an all-cash transaction.

The company has steadily expanded its footprint in the US since its launch in the region in 2019 and currently operates over 320 hotels across 35 States. In 2023, OYO added nearly 100 hotels to its US portfolio and aims to add 250 hotels in 2024.

Motel 6’s franchise network produces gross room revenues of $1.7 billion, which generates a strong fee base and cash flow for G6.

“This acquisition is a significant milestone for a start-up company like us to strengthen our international presence. Motel 6’s strong brand recognition, financial profile and network in the US, combined with OYO’s entrepreneurial spirit will be instrumental in charting a sustainable path forward for the company which will continue to operate as a separate entity,” said Gautam Swaroop, CEO, OYO International.

Under its ownership, Blackstone invested significant capital to create value and enhance the Motel 6 brand, including executing a strategy to transform the business into a leading asset-light lodging company with a franchise network of ~1500 hotels across the US and Canada.

The transaction is expected to close in the fourth quarter of 2024, subject to customary closing conditions.

Goldman Sachs & Co. LLC acted as Blackstone’s lead advisor and Jones Lang LaSalle Securities, LLC and PJT Partners acted as financial advisors. Simpson Thacher & Bartlett LLP served as Blackstone’s legal advisor.

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