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Timeshare Financial News: June 17, 2017

It's Happy Hour at The GateHouse

What’s going on in the world of timeshare financial news this week? Well, let’s start with Bluegreen Corporation, which recently completed a securitization involving the issuance of $120.2 million of investment-grade vacation ownership loan-backed notes.

The issuance was made through BXG Receivables Note Trust 2017-A and is comprised of $88.8 million of A rated vacation ownership loan-backed notes and $31.4 million of BBB-/BBB rated vacation ownership loan-backed notes. The Class A and Class B notes have interest rates of 2.95% and 3.59% respectively, for an overall weighted average interest rate of approximately 3.12%. The gross advance rate for this transaction was 88%. KeyBanc Capital Markets Inc. served as joint book runner, structuring agent and co-lead manager on the transaction. Barclays Capital Inc. also served as joint book runner and co-lead manager. KeyBanc Capital Markets and Barclays Capital were also the initial purchasers of the notes.

This was was Bluegreen’s twelfth securitization of vacation ownership receivables. They didn’t mention what the money would be used for.

Hilton Grand Vacations has announced that “certain selling stockholders” affiliated with The Blackstone Group L.P., which used to own HGV when it was still part of Hilton Worldwide, have commenced a secondary offering of 9,650,000 shares of HGV common stock. The offering is expected to close on June 20, 2017, subject to customary closing conditions.

Note that this is a purely Blackstone deal. HGV is not offering any shares of common stock in the offering and will not receive any proceeds from the sale of shares in this offering. In addition, none of HGV’s officers or directors are selling any shares of common stock beneficially owned by them in the offering.

J.P. Morgan is serving as underwriter for the offering and a copy of the prospectus relating to these securities may be obtained, when available, from: J.P. Morgan Securities LLC, Attention: Broadridge Financial Solutions, 1155 Long Island Avenue, Edgewood, NY 11717, telephone: 1-866-803-9204.

And ILG, parent company to Aqua-Aston Hospitality, Hyatt Vacation Ownership, Interval International, Trading Places International, Vacation Resorts International, VRI Europe, and Vistana Signature Experiences apparently is not big enough to suit hedge fund FrontFour Capital Group Llc, according to sources such as CNBC. FrontFour owns 2% of ILG stock, which makes it powerful enough to make ILG’s board sit up and take notice when contacted by them.

What does FrontFour want? In an open letter to ILG they urged ILG to get BIGGER in order to increase stock value for shareholders by merging with Marriott Vacations, which has a market value of $3.4 billion, though maybe Hilton Grand Vacations would do in a pinch. And they threatened ILG with disquiet if they don’t get their way.

No publicly owned company wants disquiet in the ranks.

As a result, ILG is said to be in the beginning stages of merger talks with more than one company, working with investment bank Moelis & Co to help them out.

ILG, Marriott, et al are not talking at this point. Stay tuned?

ALSO: In less exciting news, ILG will participate in the Oppenheimer Consumer Conference and SunTrust Robinson Humphrey Vacation Ownership & Exchange Conference to be held in Boston on June 20 and New York City on June 21, respectively. Craig M. Nash, chairman, president and CEO; William Harvey, CFO; and Lily Arteaga, vice president of investor relations, are scheduled to attend the conference.

Nash will participate in a Fireside Chat at 11:05 a.m. at the Oppenheimer conference on June 20. The event will be webcast and will be accessible from the Company’s website at www.ilg.com. The webcast replay will be available after the live event and will remain available on the website for 180 days following the conferences.

That’s all for this week. bye-bye $$$

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