Oyo Acquires G6 Hospitality for $525 Million, Eyes Ebitda Growth to Over Rs 2,000 Crore by FY26

SoftBank-backed Oyo has finalized the acquisition of G6 Hospitality, a prominent US-based operator of Motel 6 and Studio 6 brands, for $525 million.

The move is set to expand Oyo’s global footprint and enhance its profitability significantly.

Strategic Acquisition to Boost Profitability

This acquisition is projected to increase Oyo’s EBITDA (earnings before interest, taxes, depreciation, and amortization) to over Rs 2,000 crore by FY26.

Motel 6 is anticipated to contribute an EBITDA of over Rs 630 crore in the next financial year, which will mark its first full year as part of Oyo.

Ankit Tandon, Oyo’s Global Chief Business Officer and Head of Mergers and Acquisitions, emphasized, “We see this as a value-accretive acquisition due to their strong brand franchise in the US, potential for growth, and synergies. Our success in Europe, where we nearly tripled EBITDA through strategic synergies for our vacation homes business, has provided us with a clear roadmap for value creation.”

Expanding Presence in North America

With the addition of approximately 1,500 franchised hotels across the US and Canada, Oyo has significantly strengthened its presence in North America.

The combined entity is forecasted to generate a gross booking value of $3 billion, with G6 Hospitality contributing $1.7 billion. This marks a major step for Oyo as it continues to scale its global operations.

First Net Profit Marks Turning Point

The acquisition aligns with Oyo’s recent financial turnaround, as the company posted its first-ever net profit of Rs 229 crore for FY24.

This is a significant improvement from the previous fiscal year and underscores the company’s strategic growth trajectory. Oyo’s robust financial performance has laid a solid foundation for its ongoing expansion.

Leveraging European Success

Europe has been a critical market for Oyo, where it has achieved substantial growth through strategic acquisitions under its Oyo Vacation Homes (OVH) brand.

OVH’s portfolio includes key players such as DanCenter, which manages 12,000 properties across Denmark, Sweden, Norway, and Germany. Since its acquisition in 2019, DanCenter has doubled its revenue and market presence.

Other notable European assets include Belvilla, managing 65,000 holiday homes across 20 countries, and Traum-Ferienwohnungen, an online vacation rental platform with 100,000 homes.

Recent acquisitions, such as Direct Booker in Croatia (3,200 homes) in 2022 and Paris-based CheckMyGuest in 2023, further bolster Oyo’s European operations.

Leadership Transition at G6 Hospitality

Sonal Sinha has been appointed CEO of G6 Hospitality following the acquisition.

Oyo plans to retain G6’s franchise development, support, and safety operations while integrating corporate functions with Oyo’s global excellence teams.

The company also aims to add over 150 hotels under the Motel 6 and Studio 6 brands in 2025, enhancing their presence in key markets.

Strengthening Global Operations

Oyo’s North American operations already span 35 states with around 400 hotels. This acquisition provides a strong platform for further growth in the region.

Meanwhile, Oyo’s global portfolio now encompasses over 1,84,000 properties across Europe, the US, the UK, Southeast Asia, and the Middle East.

Key Financial Projections

The combined entity is expected to generate a gross booking value of approximately $3 billion, with G6 Hospitality contributing $1.7 billion.

Oyo’s adjusted EBITDA rose sharply to Rs 888 crore in FY24 from Rs 274 crore in FY23. With the integration of G6 Hospitality, the company anticipates surpassing Rs 2,000 crore in EBITDA by FY26.

Building on Success

Oyo’s acquisition of G6 Hospitality underscores its commitment to becoming a global hospitality leader.

By leveraging synergies from its European successes and capitalizing on the strong brand presence of Motel 6 and Studio 6 in North America, Oyo is well-positioned for sustainable growth and profitability.