Motel 6 sold to Indian hotel operator for $525 million

Budget motel chain Motel 6 is being acquired by the parent company of Oyo, an India-based hotel operator.

New York-based investment firm Blackstone, which owns Motel 6’s parent company G6 Hospitality, said Friday the deal would be an all-cash transaction valued at $525 million.

The transaction will also include the sale of the Studio 6 motel brand, which caters to guests seeking extended stays. The transaction is expected to close by the end of the year.

Oyo, which was launched in India just over a decade ago, has been expand its footprint in the United States in recent years. The company says it currently operates 320 hotels in 35 states and hopes to add 250 more this year.

“This acquisition is an important step for a start-up like ours to strengthen our international presence,” Gautam Swaroop, head of OYO’s international division, said in a statement.

Blackstone bought Motel 6 and Studio 6 in 2012 for $1.9 billion. Since then, the private equity giant says it has invested heavily in the brand and implemented a strategy that has transformed the chain into a franchise.

“This transaction is a tremendous result for investors and represents the culmination of an ambitious business plan that has more than tripled our investors’ capital and generated over $1 billion in earnings during our ownership period,” Rob Harper, head of Blackstone Real Estate Asset Management Americas, said in a statement.

As part of the deal, Oyo owner Oravel Stays will acquire G6 Hospitality.