Indian startup company OYO, which is preparing for an IPO, is expanding its business outside India. As part of this, the company is close to finalizing a major deal in the US. This deal will be entirely in cash.

Preparing to Buy This American Company

According to a report from news agency PTI, OYO’s parent company Oravel Stays shared details of the proposed deal on Saturday. The company stated that it is ready to buy the American company G6 Hospitality. G6 Hospitality operates under the Motel 6 and Studio 6 brand names in the US. These brands are considered iconic budget hotel brands in the US.

$525 Million All-Cash Deal

OYO is buying these budget hotel brands from Blackstone Real Estate. According to the information provided by the company, this deal will be entirely in cash for $525 million. It is expected to be completed in the last quarter of this year. OYO mentioned that the deal could be finalized between October and December 2024, after regulatory approvals.

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Operating in the US Since 2019

OYO already has a strong presence in the US. The company entered the US market in 2019. Last year, it added about 100 new hotels in the US. Currently, OYO has more than 320 hotels across 35 states in the US. The company plans to add around 250 hotels this year.

OYO Hopes to Benefit from the Deal

The hospitality startup OYO believes that acquiring G6 Hospitality will significantly help it expand its reach in the US. G6 Hospitality earns a substantial income from the Motel 6 franchise network, which has generated $1.7 billion in gross room revenue for the company. This brand has established a strong fee base for G6 Hospitality, providing it with a healthy cash flow.