New Delhi & Dallas – September 20, 2024 – In a move set to reshape the economy lodging landscape, global travel technology company OYO, under its parent company Oravel Stays, has announced its acquisition of G6 Hospitality from Blackstone Real Estate. The all-cash transaction, valued at $525 million, marks a significant expansion for OYO in the crucial North American travel market, specifically within the “Travel Blackstone” investment sector, as Blackstone strategically divests from its hospitality holdings.
OYO, known for its technology-driven approach to hotel management and franchising, has been steadily growing its presence in the United States since 2019. With over 320 hotels across 35 states currently under its umbrella, and an ambitious target to add approximately 250 more in 2024 alone, this acquisition of G6 Hospitality is a monumental leap forward. G6 Hospitality, the parent company of the iconic Motel 6 and Studio 6 brands, brings to the table a vast franchise network generating gross room revenues of $1.7 billion annually. This established revenue stream, coupled with OYO’s technological prowess and global distribution network, promises a robust future for the combined entity.
Image: A classic Motel 6 exterior, showcasing the brand’s recognizable and accessible lodging for travelers.
Gautam Swaroop, CEO of OYO International, emphasized the strategic importance of this acquisition: “This acquisition is a significant milestone for a startup 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.” This statement highlights OYO’s ambition to leverage established brands like Motel 6 to accelerate its growth and market penetration within the competitive US travel industry.
Blackstone’s Strategic Real Estate Move in Travel Sector
For Blackstone Real Estate, the sale of G6 Hospitality represents a successful culmination of their investment strategy. During their ownership, Blackstone injected considerable capital into G6, transforming it into a leading asset-light lodging franchisor with approximately 1,500 hotels across the United States and Canada. This strategic overhaul significantly enhanced the value of the Motel 6 brand and solidified G6’s position in the economy lodging sector.
Rob Harper, Head of Blackstone Real Estate Asset Management Americas, commented on the transaction’s success: “This transaction is a terrific outcome for investors and is the culmination of an ambitious business plan that more than tripled our investors’ capital and generated over $1 billion in profit over our hold period. We believe G6 is extremely well-positioned for the future and we look forward to seeing its brands continue their success in the years to come.” This statement underscores the profitability and strategic rationale behind Blackstone’s investment and subsequent divestment from G6 Hospitality, aligning with broader trends in “travel blackstone” and real estate investment strategies.
Image: A Studio 6 Extended Stay property, designed for travelers needing longer-term accommodations with essential amenities.
G6 Hospitality Poised for Growth Under OYO’s Tech-Forward Approach
G6 Hospitality’s leadership also views this acquisition as a positive step forward. Julie Arrowsmith, President and CEO of G6 Hospitality, stated, “We are grateful for our successful partnership with Blackstone and the transformation that has positioned us well for this new chapter. OYO’s innovative approach to hospitality will allow us to enhance our offerings and great value to our guests while maintaining the iconic Motel 6 brand that travelers have trusted for over six decades.” This perspective indicates confidence that OYO’s technology-driven platform will enhance guest experiences and franchisee opportunities within the Motel 6 and Studio 6 networks.
The acquisition is anticipated to close in the fourth quarter of 2024, pending standard closing conditions. Goldman Sachs & Co. LLC served as Blackstone’s lead advisor, while Jones Lang LaSalle Securities, LLC and PJT Partners acted as financial advisors. Simpson Thacher & Bartlett LLP provided legal counsel to Blackstone.
About the Companies
OYO: A global platform empowering hotel and home entrepreneurs with technology and services to enhance revenue and operations. OYO provides over 40 integrated products and solutions to over 175,000 storefronts across more than 35 countries.
G6 Hospitality LLC: A leading economy lodging franchisor with nearly 1,500 locations under the Motel 6 and Studio 6 brands in the US and Canada. Recognized for its commitment to accessible hospitality and franchisee opportunities.
Blackstone Real Estate: A global leader in real estate investing with US $336 billion of investor capital under management. Blackstone is the world’s largest commercial real estate owner, with holdings across various sectors including hospitality.
CONTACTS:
OYO
Anupriya Malik
[email protected]
G6 Hospitality
Maggie Giddens
[email protected]
Blackstone
Jeffrey Kauth
[email protected]
