WYNDHAM WORLDWIDE CORP. $115 (New York symbol WYN; Consumer sector; Shares outstanding: 99.9 million; Market cap: $11.5 billion; Dividend yield: 2.3%; Takeover Target Rating: Medium; www.wyndhamworldwide.com) is one of the world’s largest hospitality companies, with over 8,400 franchised hotels across 80 countries and under 19 brands.

Wyndham continues to move forward with its plan to split its operations into two separate, publicly traded companies. It will do that by spinning off its hotel business (called Wyndham Hotels & Resorts Inc.) That operation manages properties around the world under names such as Wyndham, Dolce Hotels and Resorts, Ramada Worldwide, Days Inn, and many others.

The remaining company (called Wyndham Destinations Inc.) will focus on Wyndham’s time-share business and hold Wyndham Vacation Ownership and RCI (a vacation-ownership exchange network).

Wyndham Hotels & Resorts:

• 9,300 affiliated hotels in 80 countries; pro-forma annual revenue of $2.1 billion, and gross earnings of $600 million.

Wyndham Destinations:

• 878,000 owners and 3.9 million members; pro-forma annual revenue of $4.1 billion, and gross earnings of $965 million.

As part of its preparations for the split, Wyndham has announced several transactions.

Those include the sale of its European vacation rentals business for $1.3 billion. As part of the sale, Wyndham will licence its name to the new owner for the next 20 years. In exchange, it will receive a royalty equal to 1% of the European business’s revenue. Wyndham expects to complete the sale in the second quarter of 2018.

The company will also sell its Knights Inn brand to RLH Corporation for $27 million. The economy-segmented brand was once known for the medieval-inspired architecture of its properties, which resembled castles; Knights Inn opened its first hotel in 1974, in Columbus, Ohio. Today, it has about 350 hotels operating across North America, with an additional 47 properties under development.

The sale of those hotels should also increase Wyndham’s appeal. That’s because an economy chains like Knights Inn lowers the company’s overall revenue per available room.

Altogether, cash from those sales will help Wyndham complete its purchase of the hotel franchise and management businesses of LA QUINTA HOLDINGS INC. $20 (New York symbol LQ; Consumer sector; Shares outstanding: 117.3 million; Market cap: $2.3 billion; No dividends paid; Takeover Target Rating: Medium; www.lq.com). It operates a chain of 885 limited-service hotels, in the U.S., Canada, Mexico and Honduras. The properties operate under the banners of La Quinta Inn & Suites, La Quinta Inn and LQ Hotel.

Under the terms of the deal, Wyndham will pay $1.95 billion for those businesses. Before that, however, La Quinta will spin off its real-estate assets as a new real estate investment trust called CorePoint Lodging Inc.

CorePoint will own 316 hotels with 40,500 rooms in 41 states. It will focus exclusively on midscale and upper-midscale hotels. A total of 32% of its rooms will be in the top 25 U.S. markets. Overall, 72% of its rooms are in the suburbs or near airports. La Quinta expects to complete the spinoff in the second quarter of 2018.

The La Quinta acquisition adds the management of nearly 900 hotels to Wyndham’s portfolio. As well, the La Quinta brand will become one of Wyndham’s flagship hotel names.

Wyndham Worldwide is still a hold. However, La Quinta is a spinoff buy.