OYO acquires Motel 6-parent G6 Hospitality for $525 Mn

OYO has agreed to acquire G6 Hospitality, the operator of Motel 6 and Studio 6, for $525 million in an all-cash transaction.

The acquisition will see OYO taking over the US-based firm from Blackstone Real Estate, with the deal expected to close by the last quarter of 2024, OYO said in a press release.

Blackstone had previously acquired the Motel 6 and Studio 6 brands from French hotel company Accor in a $1.9 billion deal in 2012. Currently, Motel 6 operates more than 1,450 hotels across the US and Canada, while Studio 6 has over 200 properties.

Motel 6’s franchise network generates $1.7 billion in annual gross room revenues. OYO has added nearly 100 properties in the US in 2023 and plans to add 250 more in the ongoing calendar year.

This acquisition marks OYO’s second major purchase in recent times. Just last month, the Gurugram-based company acquired Paris-based Checkmyguest for over $27 million.

The acquisition comes shortly after OYO’s $175 million funding round, with $100 million contributed by founder Ritesh Agarwal. Additionally, OYO is expected to refile its draft IPO papers soon, following its earlier decision to withdraw the draft due to unfavorable conditions.

In the last fiscal year, the firm turned profitable, posting a Rs 239 crore profit after tax. However, its revenue from operations declined 1.4% to Rs 5,389 crore in FY24 from Rs 5,464 crore in FY23.