Hilton Grand Vacations Inc. (NYSE:HGV) (“HGV” or “the Company”)
has priced an offering of $900 million aggregate principal amount
of new 6.625% senior secured notes due 2032 (the “notes”) to be
issued by its wholly-owned subsidiaries, Hilton Grand Vacations
Borrower Escrow, LLC and Hilton Grand Vacations Borrower Escrow,
Inc. (the “Offering”). To the extent the Offering closes
concurrently with the Acquisition (as defined below), the notes
will be issued by Hilton Grand Vacations Borrower LLC and Hilton
Grand Vacations Borrower Inc. (together, the “surviving issuers”)
instead of Hilton Grand Vacations Borrower Escrow, LLC and Hilton
Grand Vacations Borrower Escrow, Inc.
The notes will mature on Jan. 15, 2032. The Offering is expected
to close on Jan. 17, 2024, subject to customary closing
conditions.
The private Offering is part of the financing for the Company’s
proposed acquisition (the “Acquisition”) of Bluegreen Vacations
Holding Corporation (“BVH”) and is exempt from the registration
requirements of the Securities Act of 1933, as amended (the
“Securities Act”). To the extent the Offering does not close
concurrently with the Acquisition, Hilton Grand Vacations Borrower
Escrow, LLC and Hilton Grand Vacations Borrower Escrow, Inc., which
were created solely to issue the notes and for other financing
transactions related to the Acquisition, will deposit the gross
proceeds of the Offering into a segregated escrow account until the
date that certain escrow release conditions are satisfied. Upon the
closing of the Acquisition, Hilton Grand Vacations Borrower Escrow,
LLC and Hilton Grand Vacations Borrower Escrow, Inc. will merge
with and into Hilton Grand Vacations Borrower LLC and Hilton Grand
Vacations Borrower Inc., respectively, each a wholly-owned
subsidiary of the Company, and, to the extent the Offering does not
close concurrently with the Acquisition, the escrow proceeds will
be released. The surviving issuers will thereupon assume the
obligations under the notes. To the extent the Offering closes
concurrently with the Acquisition, the surviving issuers will issue
the notes, and the escrow provisions described above will not
apply. Upon the closing of the Acquisition, the notes will be
guaranteed by Hilton Grand Vacations Inc., Hilton Grand Vacations
Parent LLC, also a wholly-owned subsidiary of the Company, and
certain of Hilton Grand Vacations Borrower LLC’s existing and
future subsidiaries (collectively, the “guarantors”). The notes and
the related guarantees will be secured on a first-priority basis by
substantially all assets of the surviving issuers and the
guarantors, which assets also secure the Company’s senior secured
credit facilities, subject to certain exceptions.
On Nov. 6, 2023, HGV announced it would acquire BVH for $75 per
share in an all-cash transaction, representing total consideration
of approximately $1.5 billion, inclusive of net debt.
Upon the closing of the Acquisition and release of the net
proceeds of the Offering from the escrow account (if applicable),
HGV intends to use the net proceeds from the Offering to (i)
finance the consummation of the Acquisition, (ii) repay certain
outstanding indebtedness and (iii) pay related fees, costs,
premiums and expenses in connection with these transactions.
The notes and related guarantees have not been, and will not be,
registered under the Securities Act or the securities laws of any
other jurisdiction and may not be offered or sold in the United
States absent registration or an applicable exemption. The notes
are being offered only to persons reasonably believed to be
qualified institutional buyers under Rule 144A of the Securities
Act or, outside the United States, to persons other than “U.S.
persons” in compliance with Regulation S under the Securities
Act.
This press release does not constitute an offer to sell or the
solicitation of an offer to buy the notes and related guarantees
and shall not constitute an offer, solicitation or sale of any
securities in any jurisdiction in which such offer, solicitation or
sale would be unlawful. This press release is being issued pursuant
to and in accordance with Rule 135c under the Securities Act.
Forward Looking Statements
This press release contains forward-looking statements within
the meaning of Section 27A of the Securities Act and Section 21E of
the Securities Exchange Act of 1934, as amended (the “Exchange
Act”). Forward-looking statements convey management’s expectations
as to the Company’s future, and are based on management’s beliefs,
expectations, assumptions and such plans, estimates, projections
and other information available to management at the time the
Company 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 the Company’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 the Company
and BVH.
The Company cautions you that its forward-looking statements
involve known and unknown risks, uncertainties and other factors,
including those that are beyond the Company’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 the Company and BVH, could adversely
impact the Company’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 the Company’s most recent Annual Report on Form
10-K, which may be supplemented and updated by the risk factors in
the Company’s quarterly reports (including, without limitation, the
Company’s Quarterly Report on Form 10-Q for the quarter ended Sept.
30, 2023), current reports and other filings the Company makes with
the Securities and Exchange Commission.
The Company’s forward-looking statements speak only as of the
date of this press release or as of the date they are made. The
Company disclaims any intent or obligation to update any “forward
looking statement” made in this press release to reflect changed
assumptions, the occurrence of unanticipated events or changes to
future operating results over time.
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.
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version on businesswire.com: https://www.businesswire.com/news/home/20240110168694/en/
Investor Contact: Mark Melnyk 407-613-3327 mark.melnyk@hgv.com
Media Contact: Lauren George 407-613-8431 lauren.george@hgv.com
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