Starwood Hotels & Resorts Worldwide (HOT) announced plans to spin-off its vacation ownership business, Starwood Vacation Ownership (“SVO”), into a separate publicly traded company. In addition to accelerating Starwood’s ongoing ‘Asset Light’ transformation, the transaction will create a new pure-play vacation ownership company with a seasoned management team and a strong balance sheet to take advantage of increasing growth opportunities within the timeshare industry. The spin-off is expected to be completed by year-end.
The transaction, which is expected to be tax-free to Starwood shareholders, will be effected through a pro rata distribution of the new entity’s stock to existing Starwood shareholders.
SVO reported vacation ownership revenues of approximately $640 million in 2014 and has successfully sold more than $6 billion of vacation ownership intervals to over 220,000 owners over its 30+ year history. SVO has been recognized as a leader in the timeshare industry with deep management experience across its operations, and has a long track record for delivering world-class experiences to its owners and guests.
Starwood will disclose more details of the transaction upon the filing of a Form 10 registration statement with the Securities and Exchange Commission, including more details about the respective pro forma balance sheets and pro forma income statements. The name of the new company will be determined in the coming months, and further information will be disclosed in future communications. Source
