Unites two highly complementary businesses to
further scale and drive growth, adding over 200,000 members and 48
managed resorts in 14 new geographies, unlocking additional upside
from HGV’s recent strategic infrastructure investments
Expands and diversifies lead flow through
Bluegreen Vacations’ world-class strategic partnerships, including
the signing of a new 10-year exclusive marketing agreement with
Bass Pro Shops, America’s Premier Outdoor and Conservation Company
with over 220 million customers annually
Adjusted free cash flow accretive transaction
that generates ~$100 million in projected run-rate cost synergies,
expected to be achieved in the first 24 months following close
Hilton Grand Vacations Inc. (NYSE:HGV) (“HGV” or “the Company”)
today announced that it has entered into a definitive agreement to
acquire Bluegreen Vacations (NYSE: BVH; OTCQX: BVHBB) for $75 per
share in an all-cash transaction, representing total consideration
of approximately $1.5 billion, inclusive of net debt. The
combination will broaden HGV’s offerings, customer reach and sales
locations creating a premier vacation ownership and experiences
company.
The acquisition is also expected to expand and diversify HGV’s
lead flow through Bluegreen Vacations' world-class partnerships,
including an exclusive marketing agreement with Bass Pro Shops and
its unique base of dedicated outdoor lifestyle enthusiasts.
Expanding on Bluegreen Vacations' existing relationship, HGV also
announced today that it has signed a new 10-year exclusive
marketing agreement with Bass Pro Shops.
“I’m excited to enhance the breadth and quality of our already
best-in-class vacation ownership and experiences offering with the
announcement of our agreement to acquire Bluegreen Vacations,” said
Mark Wang, president and CEO of Hilton Grand Vacations. “Bluegreen
Vacations has a strong track record of demonstrated organic growth,
a dedicated customer base of more than 200,000 members, and boasts
key lead-generating strategic partnerships that will broaden our
reach and diversify our tour flow. Along with our long-standing
relationship with Hilton, this highly complementary combination
will also unlock additional upside by leveraging the infrastructure
we have built over the past few years with the launch of the Hilton
Vacation Club brand, our HGV Max membership offering, the HGV
Ultimate Access experiential platform. I’m particularly excited
about the opportunity to enter into a new relationship with Bass
Pro Shops and its actively engaged, loyal community of outdoor
enthusiasts. We’re confident that our team members, shareholders,
members and consumers will all significantly benefit from the
combination of these exceptional organizations.”
Alan Levan, Bluegreen Vacations chief executive officer said,
“Today’s announcement represents another exciting chapter for
Bluegreen Vacations. Combining with HGV will create an even more
compelling vacation ownership offering, continuing to provide our
owners and guests with enjoyable and unique experiences across a
broader range of world-class destinations. I am extremely proud of
the entire Bluegreen team for helping build Bluegreen into a
leading vacation ownership company.”
Bass Pro Shops
Partnership
In addition to the announced acquisition of Bluegreen Vacations,
HGV today announced the signing of an exclusive 10-year marketing
agreement with Bass Pro Shops, the premier outdoor retail and
conservation company. This new partnership builds on Bluegreen
Vacations' success as the official vacation ownership partner of
Bass Pro Shops and includes the existing joint venture encompassing
four outdoor-themed resorts.
“For the past 51 years at Bass Pro Shops, we’ve been blessed to
build a team of great people who are passionate about the outdoors
and serving customers. We share a bond with them and we’re always
looking for ways to add joy and excitement to their free time.
Today we’re announcing one of the biggest commitments we’ve ever
made to better serve our customers. Our new partnership with Hilton
Grand Vacations is one of the most exciting and important in our
history! It will give both of our legendary brands the ability to
introduce many more people to the great outdoors and happy memories
they will never forget,” stated Johnny Morris, founder, Bass Pro
Shops.
Transaction Highlights
- Adds scale and diversity to HGV’s offering
- Increases HGV’s membership base from more than 525,000 to more
than 740,000 and its resort portfolio from 150 to nearly 200
properties in 14 new geographies and eight new states.
- Complementary footprint of predominantly drive-to locations
will double HGV’s presence along the east coast and expand the
number of available outdoor and ski destinations while increasing
sales distribution in new key markets.
- Extends HGV's offering, broadening its customer reach and
expanding the relationship with the Hilton Honors program.
- Expands and diversifies lead flow through world-class
partnerships
- Bluegreen Vacations' longstanding strategic partnerships
complement HGV’s best-in-class lead generation while providing a
significant opportunity to diversify tour flow and improve
resilience across cycles.
- Bluegreen Vacations currently has a marketing presence in the
majority of Bass Pro Shops and owns 51% of a joint venture with
Bass Pro Shops that includes four outdoor-themed resorts, providing
access to a unique and loyal customer base.
- Unlocks upside by leveraging infrastructure of recent
business evolution
- Allows HGV to leverage recent strategic investments, including
the successful launch of its Hilton Vacation Club brand, the
expanded access provided through its HGV Max membership, and the
HGV Ultimate Access experiential events platform.
- Opportunity to offer owners and members access to more
vacations and experiences, including more resorts via HGV Max and
across an even larger portfolio, backed by the strength of the
Hilton brand.
- Builds on the success of the HGV Ultimate Access experiential
platform with the addition of Bluegreen Vacations’ outdoor-themed
properties and partnerships, including Bass Pro Shops and
NASCAR.
- Bluegreen Vacations’ high-quality properties and trust-based
structure align closely with the recently launched Hilton Vacation
Club brand, enabling a smooth integration process.
- ~$100 million in projected cost synergies expected to be
achieved in the first 24 months following close
- Significant future cost synergy opportunities across G&A,
sales, marketing and resort operations.
- HGV has a strong track record of delivering deal cost
synergies.
- Expected to generate future revenue synergies of $75 million to
$100 million, more than offsetting future incremental license
fees.
- Creates significant value with attractive financial profile,
supporting higher free cash flow conversion and base of recurring
EBITDA
- Bluegreen Vacations has a strong track record of driving Net
Owner Growth, generating significant lifetime value throughout the
upgrade cycle.
- The combined company is expected to generate adjusted free cash
flow conversion of adjusted EBITDA in the range of 55-65% in a
steady state, enabling the continued pursuit of the company’s
capital allocation strategy – including the return of capital to
shareholders.
- The transaction enhances HGV’s ability to generate significant
Segment Adjusted EBITDA from recurring sources, adding additional
resiliency to the business.
Transaction Details
Under the terms of the agreement, Bluegreen Vacations
stockholders are expected to receive $75 in cash for each share of
Bluegreen Vacations. The all-cash transaction values Bluegreen
Vacations at approximately $1.5 billion, inclusive of net debt.
The transaction, which was unanimously approved by the Board of
Directors for both companies, is expected to close during the first
half of 2024 and is subject to customary closing conditions and
regulatory approvals.
HGV’s management team, including president and CEO Mark Wang,
chief financial officer Dan Mathewes, and chief operating officer
Gordon Gurnik, will continue to serve in their current roles upon
transaction close.
HGV Third Quarter 2023 Results and
Fourth Quarter Fiscal Year 2023 Business Outlook
In a separate press release issued today, HGV reported results
for its third quarter of fiscal year 2023, ended Sept. 30, 2023,
and updated its full year 2023 guidance.
Advisors
BofA Securities is acting as the exclusive financial advisor for
HGV, and Alston & Bird LLP, Simpson Thacher & Bartlett LLP
and Foley & Lardner LLP, are acting as legal counsel. Credit
Suisse and Wells Fargo are acting as financial advisors for
Bluegreen Vacations, and Stearns, Weaver, Miller is acting as legal
counsel.
HGV has received financing commitments from Bank of America,
Deutsche Bank, Barclays and J.P. Morgan to consummate the
transaction.
Conference Call
HGV will host a conference call for analysts and investors today
at 9 a.m. (ET), which is also the time HGV will discuss its
reported results for the third quarter of 2023.
Participants are encouraged to listen to the live webcast by
logging onto the HGV Investor Relations website at
https://investors.hgv.com/events-and-presentations. The
accompanying slide presentation will be available at the same
site.
To access the live teleconference via phone, please dial
1-877-407-0784 in the U.S./Canada (or +1-201-689-8560
internationally) approximately 15 minutes prior to the
teleconference’s start time. In the event of audio difficulties
during the call on the toll-free number, participants are advised
that accessing the call using the +1-201-689-8560 dial-in number
may bypass the source of audio difficulties.
A replay will be available beginning three hours after the
teleconference’s completion through Nov. 13, 2023. To access the
replay, please dial 1-844-512-2921 in the U.S. (+1-412-317-6671
internationally) using ID# 13735181. A webcast replay and
transcript will be available within 24 hours after the live event
at https://investors.hgv.com.
About Hilton Grand Vacations Inc.
Hilton Grand Vacations Inc. (NYSE:HGV) is recognized as a
leading global timeshare company and is the exclusive vacation
ownership partner of Hilton. With headquarters in Orlando, Florida,
Hilton Grand Vacations develops, markets, and operates a system of
brand-name, high-quality vacation ownership resorts in select
vacation destinations. Hilton Grand Vacations has a reputation for
delivering a consistently exceptional standard of service, and
unforgettable vacation experiences for guests and more than 525,000
Club Members. Membership with the Company provides best-in-class
programs, exclusive services and maximum flexibility for our
Members around the world. For more information, visit
www.corporate.hgv.com.
About Bluegreen Vacations
Bluegreen Vacations Holding Corporation (NYSE: BVH; OTCQX:
BVHBB) is a leading vacation ownership company that markets and
sells vacation ownership interests and manages resorts in popular
leisure and urban destinations. The Bluegreen Vacation Club is a
flexible, points-based, deeded vacation ownership plan with 74 Club
and Club Associate Resorts and access to nearly 11,600 other hotels
and resorts through partnerships and exchange networks.
Forward-Looking Statements
This press release contains forward-looking statements within
the meaning of Section 27A of the Securities Act of 1933, as
amended and Section 21E of the Securities Exchange Act of 1934, as
amended. Forward-looking statements convey management’s
expectations as to the future of HGV, and are based on management’s
beliefs, expectations, assumptions and such plans, estimates,
projections and other information available to management at the
time HGV makes such statements. Forward-looking statements include
all statements that are not historical facts, and may be identified
by terminology such as the words “outlook,” “believe,” “expect,”
“potential,” “goal,” “continues,” “may,” “will,” “should,” “could,”
“would,” “seeks,” “approximately,” “projects,” “predicts,”
“intends,” “plans,” “estimates,” “anticipates,” “future,”
“guidance,” “target,” or the negative version of these words or
other comparable words, although not all forward-looking statements
may contain such words. The forward-looking statements contained in
this press release include statements related to HGV’s revenues,
earnings, taxes, cash flow and related financial and operating
measures, and expectations with respect to future operating,
financial and business performance and other anticipated future
events and expectations that are not historical facts, including
related to the proposed transaction between HGV and Bluegreen
Vacations.
HGV cautions you that our forward-looking statements involve
known and unknown risks, uncertainties and other factors, including
those that are beyond HGV’s control, which may cause the actual
results, performance or achievements to be materially different
from the future results. Any one or more of these risks or
uncertainties, including those related to the proposed transaction
between HGV and Bluegreen Vacations, could adversely impact HGV’s
operations, revenue, operating profits and margins, key business
operational metrics, financial condition or credit rating. For a
more detailed discussion of these factors, see the information
under the captions “Risk Factors” and “Management’s Discussion and
Analysis of Financial Condition and Results of Operations” in HGV’s
most recent Annual Report on Form 10-K, which may be supplemented
and updated by the risk factors in HGV’s quarterly reports, current
reports and other filings HGV makes with the SEC. HGV’s
forward-looking statements speak only as of the date of this
communication or as of the date they are made. HGV disclaims any
intent or obligation to update any “forward-looking statement” made
in this communication to reflect changed assumptions, the
occurrence of unanticipated events or changes to future operating
results over time.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20231105290916/en/
HGV Investor: Mark Melnyk 407-613-3327
mark.melnyk@hgv.com
HGV Media: Lauren George 407-613-8431
lauren.george@hgv.com
Bluegreen Vacations Investor: Sharon Stennett
954-399-7193 IR@bvhcorp.com
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