DENVER—RLH Corporation today announced it has entered into a definitive agreement to acquire the Knights Inn brand from Wyndham Hotel Group for an aggregate price of $27 million cash. The Knights Inn brand has more than 350 economy segment hotels across North America and a pipeline of about 47 more hotels. The transaction is expected to close in the second quarter of 2018, subject to customary closing conditions.
RLH Corporation expects the transaction to enhance franchise revenue and EBITDA growth and boost franchise profit margins by leveraging existing technology and support systems. The transaction will be immediately accretive to the company’s earnings and cash flow.
“The acquisition of Knights Inn enhances RLH Corporation’s position as one of the 10 largest hotel franchisors in the world,” Greg Mount, RLH Corporation president and CEO, says. “In the first quarter of 2018, we announced the sale of five hotels and committed to enhance the company’s aggressive organic growth with acquisitions that could be accomplished primarily with our existing cost base and resources. This acquisition will increase our franchise units by over 30 percent and we will continue to grow the brand aggressively as we have demonstrated with our other brands.”
“Wyndham helped grow Knights Inn into a nationally known name with more than 350 hotels throughout the U.S. and Canada,” Geoff Ballotti, president and CEO of Wyndham Hotel Group, says. “While we’re proud of what we’ve been able to accomplish, we believe now is the right time to make this move and are confident that RLH Corporation will only continue to support and grow the brand.”
RLH Corporation plans to roll out its technology and guest recognition program to guests and owners across the Knights Inn brand quickly after integration, Mount adds. Owners will be brought onto RLH Corporation’s systems for customer acquisition, guest management, and business intelligence tools. Knights Inn hotels will participate in RLH Corporation’s Hello Rewards program as well.