Months of negotiations about a potential merger between two of the nation’s biggest budget hotel chains have hit yet another snag.

Wyndham Hotels & Resorts has rejected Choice Hotels' proposed cash-and-stock acquisition offer, which hasn't been updated despite a decline in Choice's stock that has reduced the offer price from $90 to $86 per share, The Wall Street Journal reports.

In a letter to Choice, Wyndham executives called the latest bid in the hostile takeover a “step backwards” and said the offer undervalues the hotel chain.

“Seeing this drag on and given that they’re failing to provide any adequate compensation for a deal with this type of lopsided risk is a real issue for us,” Wyndham Chairman Stephen Holmes told the WSJ.

The latest proposal comes on the heels of Choice’s original public $7.8B offer to buy Wyndham in October, worth $49.50 in cash and the rest in stock. At the time, the offer amounted to a 30% premium to Wyndham’s closing price of $69.10, but the company turned it down, citing business and execution risks.

Wyndham shares closed Monday at $77.95, giving the company a market capitalization of $6.5B, the WSJ reported. Choice shares ended the day at $113.62, bringing its market value to about $5.7B.

Choice has been looking to buy Wyndham since May. If the two companies join forces, it would combine Wyndham’s 24 hotel brands with Choice’s 22 and result in a total portfolio of more than 16,500 properties.

The hospitality sector, which suffered tremendous losses early in the pandemic, is once again attracting interest from investors. Corporate travel returned to pre-pandemic levels earlier this year, and the urge to travel for leisure remains strong.

Despite the industry’s rebound, budget hotels such as those helmed by Choice and Wyndham continue to underperform higher-end counterparts, according to CBRE data. Monthly revenue per available room in the economy and midscale sectors declined by 6.1% and 1.9%, respectively, in September, versus a gain of 3.4% among upscale hotels.