Choice Hotels to Purchase Radisson Hotel Group for $675 Million
Choice Hotels International announced it would purchase the Radisson Hotel Group’s franchise business, operations and intellectual property of Radisson Hotel Group Americas for approximately $675 million.
The addition of Radisson’s nine hotel brands, 624 hotels and over 68,000 rooms expand Choice’s presence in the upscale and core upper-midscale hospitality segments, particularly in the West Coast and Midwest of the United States.
The transaction brings Choice’s RevPAR (revenue per available room) growth performance to a new set of franchisees and hotel investors and provides growth opportunities to expand the company’s presence to additional locations in Canada, Latin America and the Caribbean.
“Choice has a well-established history of smart acquisitions in new segments where our world-class franchising engine can spur future growth,” Choice President Patrick Pacious said.
“This 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,” Pacious continued.
Consistent with Choice’s 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.
The transaction unlocks significant potential value for the Radisson brands in the Americas, as Choice is familiar with the Americas franchisee community and will bring a strong commitment to driving the success of Radisson franchisees.
“Since the introduction of our strategic transformation plan in 2017, Radisson Hotel Group has been committed to the global success of the Radisson brands and expanding the overall footprint of our global operations,” Radisson CEO Federico J. Gonzalez said.
“We are confident that Choice Hotels is the owner with the right long-term strategy, resources and management team to successfully accelerate the growth of the Radisson business in the Americas,” Gonzalez continued.