Hilton to spin off timeshares, most of real estate business

NEW YORK, N.Y. – Hilton plans to spin off its timeshare business and most of its real estate business in a move to boost shareholder value.

The lodging company said Friday that the real estate business will be spun off into a publicly traded real estate investment trust. It will include about 70 properties.

Hilton’s timeshare business, Hilton Grand Vacations, will become a separate publicly traded company that’s expected to manage almost 50 club resorts in the U.S. and Europe. The newly formed timeshare company will have an exclusive, long-term license agreement with Hilton Worldwide to market, sell and run resorts under the Hilton Grand Vacations brand.

Both spinoffs are expected to be completed by year’s end. The transactions need final approval from Hilton’s board, but don’t require a shareholder vote.

Hilton Worldwide Holdings Inc. also announced its fourth-quarter financial results, reporting an adjusted profit of 22 cents per share on revenue of $2.86 billion. Analysts polled by Zacks Investment Research predicted a profit of 22 cents per share on revenue of $2.99 billion.

Its shares rose 50 cents, or 2.5 per cent, to close at $20.70 on Friday. Its shares have fallen more than 26 per cent over the past year.