Oyo Acquires US Hospitality Chain with 1,500 Motels for $525 Million
In a move to enhance its international footprint, Oyo’s parent company, Oravel Stays, is acquiring the Motel 6 and Studio 6 chain, which comprises approximately 1,500 properties across the US and Canada, from investment firm Blackstone for $525 million in cash.
This acquisition of G6 Hospitality, the parent company of these budget hotel brands, positions Oyo as a significant player in the US and Canadian hospitality markets, which are predominantly led by Indian Americans.
Blackstone noted that Motel 6’s franchise network generates gross room revenues of $1.7 billion. The brand is well-known for its affordable accommodations that maintain corporate standards in service and upkeep. Studio 6 caters to guests seeking extended stays with additional amenities.
Gautam Swaroop, Oyo International CEO, emphasized that the acquired brands will continue to operate as separate entities. “This acquisition marks a significant milestone for us as a startup, bolstering our international presence,” he stated.
“Motel 6’s strong brand recognition, financial strength, and extensive network in the US, combined with Oyo’s entrepreneurial approach, will be crucial in driving sustainable growth for the company,” he added.
Blackstone mentioned that Oyo will utilize its advanced technology suite, global distribution network, and marketing expertise to enhance the Motel 6 and Studio 6 brands and promote financial growth.
Since launching in the US in 2019, Oyo has expanded its portfolio to include 320 hotels—approximately 100 of which were acquired last year—across 35 states, according to Blackstone.
The US hospitality sector boasts around 108,000 hotels and motels, with Indian American entrepreneurs owning about 60% of them, as reported by the Asian American Hotel Owners Association. Notably, many Motel 6 locations are already operated by Indian nationals.
Blackstone had previously acquired Motel 6 from the French hotel company Accor in 2012 for $1.9 billion. Although selling the chain for $525 million may seem like a loss, travel industry publication Skift highlighted that Blackstone profited significantly by enhancing and offloading many of the properties.
“Blackstone managed to triple its investors’ capital, generating over $1 billion in profit after investing $900 million to improve the properties and subsequently selling off hundreds of them,” the publication noted.
Founded in 1962, Motel 6 got its name from the original room rate of $6.
