Business Standard

Tuesday, December 24, 2024 | 01:15 PM ISTEN Hindi

Notification Icon
userprofile IconSearch

Oyo completes US-based G6 Hospitality acquisition for $525 million

The deal is expected to increase Oyo's earnings before interest, taxes, depreciation and amortisation (Ebitda) to over Rs 2,000 crore in FY26

OYO, Oyo rooms, Oyo app, Oyo logo

Oyo has also expanded its European presence through strategic acquisitions under the Oyo Vacation Homes (OVH) brand | File image

Ajinkya Kawale Mumbai

Listen to This Article

SoftBank-backed Oyo has acquired G6 Hospitality, the US-based operator of the Motel 6 and Studio 6 brands, from Blackstone Real Estate for $525 million.
 
The deal is expected to increase Oyo's earnings before interest, taxes, depreciation and amortisation (Ebitda) to over Rs 2,000 crore in FY26. Motel 6 is projected to contribute an Ebitda of over Rs 630 crore in the coming financial year, the first full year of its integration, according to the company.
 
“We see this as a value-accretive acquisition due to their strong brand franchise in the US, potential for growth, and synergies. Our success in Europe, where we nearly tripled Ebitda through strategic synergies for our vacation homes business, has provided us with a clear roadmap for value creation,” said Ankit Tandon, global chief business officer and head of mergers and acquisitions, Oyo.
 
 
The acquisition adds approximately 1,500 franchised hotels across the US and Canada to the Ritesh Agarwal-led company, expanding its North American presence. The combined entity is expected to generate a gross booking value of $3 billion, with G6 Hospitality contributing about $1.7 billion.
 
The acquisition, in the works for several months, comes as the initial public offering-bound unicorn hospitality company reported its first-ever net profit of Rs 229 crore during the financial year 2024 (FY24).
 
Oyo has also expanded its European presence through strategic acquisitions under the Oyo Vacation Homes (OVH) brand.
 
The company manages over 1,84,000 properties across Europe, the US, the United Kingdom (UK), Southeast Asia, and West Asia. Its portfolio includes the vacation home management company DanCentre, which oversees 12,000 properties in Denmark, Sweden, Norway, and Germany.
 
Oyo acquired DanCentre in 2019.
 
“DanCentre has doubled both revenue and market presence since acquisition,” the company stated.
 
OVH's brands include Belvilla, which manages 65,000 holiday homes across 20 countries, and Traum-Ferienwohnungen, an online vacation rental platform with 1,00,000 homes.
 
In 2022, Oyo acquired Direct Booker in Croatia, adding 3,200 homes to its portfolio. This year, it acquired Paris-based CheckMyGuest, a premium vacation rental company.

Don't miss the most important news and views of the day. Get them on our Telegram channel

First Published: Dec 24 2024 | 1:12 PM IST

Explore News