Wyndham Worldwide 'BBB' Rating Put On Watch Negative

NEW YORK June 3, 2008--Standard & Poor's Ratings Services today placed its ratings for Wyndham Worldwide Corp., including the 'BBB' corporate credit rating, on CreditWatch with negative implications.


The CreditWatch listing follows Wyndham's announcement that it plans to purchase the economy-segment Microtel Inns & Suites and the mid-scale extended-stay Hawthorne Suites brands from a subsidiary of Global Hyatt Corp.

The purchase price was not disclosed. While the brand acquisitions are a good strategic fit for Wyndham, the announcement comes at a time when Wyndham's leverage profile (captive finance adjusted) is higher than our comfort level at the current rating level.

(That said, we expect the transaction to add only a modest amount to the company's leverage--and all by itself, the transaction would not lead to a potential downgrade.) Captive finance adjusted leverage was near 3x at March 2008, compared with appropriate levels for a 'BBB' rating in the mid-2x area.

We currently anticipate continued operating momentum in Wyndham's businesses and an increase in EBITDA in 2008. We will factor our expectation for operating performance, as well as how the company plans to use its balance sheet to achieve intermediate- and long-term growth objectives, into the resolution of the CreditWatch listing.

"In the event there is a downgrade, we expect that it would be limited to one notch," noted Standard & Poor's credit analyst Emile Courtney.

Media Contact:Mimi Barker, New York (1) 212-438-5054, mimi_barker@standardandpoors.com Analyst Contact:
Emile Courtney, CFA, New York (1) 212-438-7824