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+--- Thread: HILTON SPIN OFF TO THREE COMPANIES (/thread-183.html)
HILTON SPIN OFF TO THREE COMPANIES - TEAM HARLFORUM - 03-13-2016
In a move to boost shareholder value, Hilton Worldwide said on Friday it plans to spin off its owned hotels into a REIT, as well as create a separate public timeshare business, resulting in three separate businesses. Hilton CEO Chris Nassetta stated the move allows "dedicated management teams to fully activate their respective businesses, taking advantage of both organic and inorganic growth opportunities as well as capital market and tax efficiencies." With more than 4,600 hotels and 12 brands, Hilton plans to spin in to the REIT about 70 properties (35,000 rooms), representing about half of its owned assets. Nassetta called the REIT inventory "bellweather assets" with a majority coming from the U.S. portfolio. Its Hilton Grand Vacations manages nearly 50 resorts in the United States and Europe, and accounted for about 12% of Hilton's total revenue in the fourth quarter. Nassetta said during Friday's analyst call that "we’re doing this to be able to activate all three businesses fully. That means both organic and inorganic growth. That includes inorganic opportunities, and the new companies will have the capability to pursue those.”