WASHINGTON - The
La Quinta Corp.'s recent acquisition of Baymont Inns & Suites
may only be the beginning.
the franchise market in 2001, the 36-year-old La Quinta Corp.
primarily grew internally, slowly expanding its La Quinta Inns and
La Quinta Inns & Suites brands. But now the company is looking
at expanding through acquisition.
"We think there
will be other acquisition opportunities for the company," said
Francis "Butch" Cash, La Quinta's president and CEO.
acquisitions would likely be geared toward adding other hotel
categories to La Quinta's portfolio.
limited-service Baymont brand, for example, complements the
midprice La Quinta, but Cash said, "To be a great lodging company,
we will need to have brands in all different segments. Going
upscale to the full-service hotels in the long term is something
that might be attractive."
If La Quinta does
add another brand or set of brands to its portfolio, it probably
won't happen before next spring because La Quinta needs time to
integrate Baymont into its marketing and sales systems.
"We are shooting
for April 1 of next year to have all of this done," he
La Quinta went
public earlier this summer with a plan to acquire 86 Baymont
properties, seven Woodfield Suites and one Budgetel Inn from the
Marcus Corp., a Milwaukee-based company that owns hotels and movie
theaters, for $395 million in cash.
adding Baymont, Woodfield and Budgetel broadens La Quinta's reach
into the Midwest. The hotel company's core markets are the
Southwest and Southeast.
Cash said the
acquisition also will provide La Quinta and Baymont opportunities
for synergy, growth and improved distribution.
Cash said, La Quinta will be able to grow Baymont's Internet sales,
which lag behind the rest of the industry. "Baymont only gets about
6% or 7% of its revenue from [sales on] third-party Web sites,"
13% of La Quinta's revenue comes from sales by online
La Quinta also
intends to market Baymont on its branded Web sites and vice versa,
along with linking rewards programs for frequent guests.
Cash said, "We will end up with one technology platform for the
reservations system, and we will end up with one sales
will also present development opportunities for existing
franchisees of La Quinta and Baymont brands, said Cash.
"And when our
franchise salespeople are calling on a potential new franchisee,
they will now have two brands to offer," he added.
could also open the door to international expansion. Last year, La
Quinta signed a deal to open its first international hotel, in
reporter Michael Milligan, send e-mail to [email protected].