Budget Hotel Chain Motel 6 to be Acquired by Indian Hotel Operator #

Motel 6, the long-standing budget hotel chain known for lining American highways, is set to be acquired by an India-based hotel operator. The all-cash deal, valued at $525 million, is expected to close before the end of the year and will include Motel 6’s offshoot brand, Studio 6.

The acquiring company, which specializes in budget hotels and describes itself as a start-up, has been expanding its presence in the United States since 2019. It currently operates over 300 hotels domestically. However, the company has faced some controversy in India in recent years regarding its business practices.

Motel 6, founded in 1962 in Santa Barbara, California, has become an iconic part of American culture with its basic accommodations. The name “Motel 6” originated from the company’s initial offering of a $6-per-night rate. Today, Motel 6 and Studio 6 have approximately 1,500 hotels across the United States and Canada.

The CEO of the acquiring company’s international division highlighted Motel 6’s strong brand recognition, financial profile, and network in the U.S. as key factors in the acquisition. He noted that this move represents a significant milestone for the company in strengthening its international presence.

The current owner of Motel 6’s parent company, a major private equity firm, purchased the hotel chain in 2012 for $1.9 billion. A senior executive from the firm stated that the transaction is a positive outcome for investors, having more than tripled their capital and generated over $1 billion in profit during their ownership period.