Oyo secures loan to fund G6 Hospitality acquisition

NEW DELHI, India — Oravel Stays Ltd., the parent company of Oyo Hotels and Homes, has entered into a commitment letter with Deutsche Bank AG New York Branch (DBNY) and Deutsche Bank Securities Inc. for a new term loan facility to finance Oyo’s recent $525 million acquisition of Carrollton, Texas-based G6 Hospitality from Blackstone.

Oyo’s deal to acquire G6 Hospitality, which operates the Motel 6 and Studio 6 brands in the U.S. and Canada, was first announced in September and was described as an all-cash transaction. Oyo said it plans for the deal to be completed by the end of the year.

The company said it will operate G6, with almost 1,500 Motel 6 and 200-plus Studio 6 properties, as a separate entity. Oyo plans to leverage its technology suite, global distribution network and marketing expertise to strengthen the acquired brands and drive continued financial growth.

Oyo recently reported its first-ever profit after tax of approximately ₹17 million as part of its fiscal year 2023-24 annual report. It also said it had achieved eight consecutive quarters of positive adjusted EBITDA, which grew significantly year-over-year in 2023-24 to $105 million, compared to $33 million the previous year.

The company has been the subject of multiple lawsuits by its franchisees and, for years now, has been trying to tap the public market. It said it has 40-plus integrated products and solutions for patrons who operate over 175,000 hotel and home storefronts in more than 35 countries, including India, Europe and Southeast Asia. Oyo has been expanding its footprint in the U.S. since 2019 and currently operates some 320 hotels across 35 states. Last year, the company added nearly 100 hotels to its U.S. portfolio and aimed to add around 250 more hotels in 2024.