OYO Acquires Motel 6 and Studio 6 Brands for $525 Million

Indian-based travel company OYO has announced its acquisition of economy budget brand Motel 6, along with its extended-stay chain Studio 6, in an all-cash deal worth $525 million. The purchase agreement, made with Motel 6’s parent company, Blackstone, is expected to be finalized by the end of 2024.

OYO International Chief Executive Officer Gautam Swaroop described the acquisition as a major milestone for the company, furthering its international expansion. “Motel 6’s strong brand recognition, financial profile, and network in the U.S., 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,” Swaroop said.

Motel 6, one of the most recognizable economy hotel chains in the U.S., has a solid financial footing and an extensive franchise network. The brand generates gross room revenues of $1.7 billion annually, a major attraction for OYO as it looks to enhance its U.S. market presence. The acquisition includes both Motel 6 and Studio 6, its extended-stay counterpart, expanding OYO’s portfolio within the budget and extended-stay sectors.

OYO first entered the U.S. market in 2019 and has since grown to operate more than 320 hotels across 35 states. The company plans to utilize its advanced technology, global distribution network, and marketing expertise to strengthen the Motel 6 and Studio 6 brands, helping the franchise maintain its competitive edge. OYO’s comprehensive tech suite, which includes property management solutions and revenue optimization tools, is expected to drive further growth for Motel 6 and Studio 6.

Rob Harper of Blackstone praised the transaction, stating, “This deal is a terrific outcome for investors and the culmination of an ambitious business plan that more than tripled our investors’ capital, generating over $1 billion in profit during our ownership.” Harper expressed confidence in the future of G6 Hospitality, the parent company of Motel 6 and Studio 6, under OYO’s ownership, and believes the brands are well-positioned for continued success.

For OYO, the acquisition marks a significant step in expanding its global footprint, particularly in the competitive U.S. market. Motel 6 and Studio 6’s established presence in the U.S. economy hotel segment complements OYO’s growth strategy, allowing the Indian travel giant to solidify its position in North America.

The acquisition comes at a time when OYO has been scaling its operations globally, having already established a presence in various international markets. The company’s investment in Motel 6 and Studio 6 is part of a broader strategy to capitalize on the budget hotel sector, which continues to perform strongly in both domestic and international markets.

Upon completion of the deal, Motel 6 and Studio 6 will remain separate entities within OYO’s portfolio but will benefit from OYO’s innovative technologies and business strategies aimed at improving operational efficiency and guest experiences. With the resources and expertise provided by OYO, Motel 6 and Studio 6 are expected to continue their upward trajectory, ensuring their long-term success in the U.S. market.