Global Travel Giant Sets Sights on Strengthening Iconic Motel 6 Brand

In a significant move for its U.S. operations, Oravel Stays, the parent company of Oyo, has announced its acquisition of G6 Hospitality, known for its Motel 6 and Studio 6 brands, from Blackstone Real Estate for $525 million in an all-cash deal. This acquisition marks a pivotal step in Oyo’s strategy to enhance its footprint in the U.S. lodging market.

A Rapid Expansion Strategy

Since entering the U.S. market in 2019, Oyo has demonstrated rapid growth, operating over 320 hotels across 35 states. The company added nearly 100 hotels to its portfolio in 2023 and plans to expand by another 250 hotels in 2024, reflecting its aggressive growth strategy in a competitive market.

Strengthening Financials through Brand Power

Motel 6’s franchise network generates gross room revenues of $1.7 billion, providing a robust fee structure and cash flow for G6. Oyo aims to utilize its advanced technology, global distribution channels, and marketing expertise to enhance the Motel 6 and Studio 6 brands, driving sustainable financial growth.

A New Chapter for Motel 6

As per industry experts, this acquisition represents a milestone for Oyo as it bolsters its international presence. The strong brand recognition and financial stability of Motel 6, combined with Oyo’s entrepreneurial approach, are expected to pave the way for future success. G6 Hospitality will continue to operate as a separate entity post-acquisition.

Transformative Partnership with Blackstone

Under Blackstone’s ownership, significant investments were made to enhance the Motel 6 brand, successfully transitioning it into a leading asset-light lodging company with approximately 1,500 hotels across the U.S. and Canada. The partnership has tripled investor capital, yielding over $1 billion in profits during its hold period.

Looking Ahead

The transaction is anticipated to close in the fourth quarter of 2024, pending customary closing conditions. Financial advisory roles in the deal were held by Goldman Sachs & Co. LLC for Blackstone, alongside Jones Lang LaSalle Securities, LLC and PJT Partners. Simpson Thacher & Bartlett LLP acted as legal advisor to Blackstone, ensuring a smooth transition as Oyo embarks on this exciting new venture.