January 18, 2018 / 11:58 AM / a year ago

UPDATE 1-Wyndham to buy La Quinta's hotel management business for $1.95 bln

(Adds details about the deal)

Jan 18 (Reuters) - U.S. hotel operator Wyndham Worldwide Corp said on Thursday it would acquire La Quinta Holdings Inc's hotel franchise and management businesses for $1.95 billion in cash, expanding its midscale presence amid increasing travel demand.

La Quinta shareholders will receive $8.40 per share in cash and Wyndham will repay about $715 million of La Quinta debt net of cash.

Ahead of the acquisition, La Quinta will spin off its real estate assets into a publicly-traded real estate investment trust, CorePoint Lodging Inc.

Wyndham, whose brands include Ramada, Days Inn, Super 8, Howard Johnson and Wingate by Wyndham, said it would set aside a reserve of $240 million for estimated taxes as part of La Quinta's spin-off of its real estate assets.

The deal is expected to close in the second quarter of 2018, Wyndham said. (Reporting by Sanjana Shivdas in Bengaluru; Editing by Sriraj Kalluvila)

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