REACHING FOR THE FUTURE
More mergers and acquisitions likely in 2018
The coming year could well be a deal-a-palooza in our industry. That became apparent in mid January, when the following two transactions were disclosed: FRCH Design Worldwide’s merger with NELSON, and Wyndham Worldwide’s bid to buy La Quinta Holdings Inc.’s hotel and franchise management business.
The pairing of NELSON, a global architecture and design firm, with FRCH, a leading designer of hospitality and retail spaces, might be the first of many such combinations to take place this year. Consider this rationale from NELSON’s top executive for entering the deal: “This merger is an exciting step demonstrating our continued commitment to bring more value to our clients with thought leadership in new practice areas and market segment expertise,” said John “Ozzie” Nelson Jr., who will serve as co-ceo of the combined firms with FRCH's Jim Tippman. “FRCH’s expertise and 50 years of experience in creating award-winning retail, hospitality, restaurant, entertainment and retail mixed-use environments and innovative consumer experiences is not only complementary to our organization, but positions us to respond to the changing disruption across multiple industries.”
Extending their reach was also on the minds of execs at Wyndham, which unveiled plans to beef up its presence in the midscale market in a big way by buying La Quinta’s hotel operations for $1.95 billion in cash. The acquisition, which involves a fee-for-service business consisting of nearly 900 managed and franchised hotels, is not yet a done deal—it’s subject to a vote by La Quinta’s shareholders—but most expect it to pass muster and close in the second quarter of this year.
“This transaction will build on Wyndham Worldwide’s proven track record of acquiring companies that are a strong strategic and cultural fit, add highly regarded brands to our portfolio and offer clear opportunities to drive shareholder value through growth, shared best practices and sharp execution,” says Stephen Holmes, Wyndham Worldwide’s chairman and ceo.
All of this either has you nervously looking over your shoulder, wondering if your firm is next, or chomping at the bit, anxious to do a deal of your own. In today’s turbulent, fast-changing economy, I’d recommend at least considering whether the latter course could help your firm hit its growth and performance goals. That, in turn, could determine whether your firm will be celebrating the next New Year, or dreading it.
Meantime, to help you make the most of 2018, be sure to check out The Buzz section in our current edition, where we detail the hottest design trends, market sectors and more for the coming year.
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