Starwood takes step to spin off vacation ownership arm
Stamford-based Starwood Hotels & Resorts Worldwide Inc. recently announced what it termed “a key milestone” toward a proposed spinoff of its vacation ownership business.
Starwood Vacation Ownership will be named Vistana Signature Experiences Inc. ”“ a separate publicly traded company ”“ upon completion of the spinoff, Starwood said in a statement.
Starwood has filed the appropriate paperwork ”“ a Form 10 registration statement ”“ with the U.S. Securities and Exchange Commission to begin the spinoff. For shareholders, according to a statement, “The spinoff will be effected through a pro rata distribution of the new entity”™s stock to Starwood stockholders.”
Starwood plans to complete the move by the fourth quarter of this year.
Adam Aron, Starwood’s interim CEO, said, “Today”™s filing is a pivotal step toward the planned spinoff of our vacation ownership business, which will allow us to continue participating in the timeshare industry while seeking to create stockholder value for both companies. The spinoff will also further advance our asset light strategy with the planned contribution of five Starwood-owned resort assets to create future timeshare inventory for the stand-alone company.”
SVO, previously known as Vistana, began in 1980 with the debut of what was then Vistana Resort in Orlando. It joined the Starwood corporate family in the 1990s and today provides upscale leisure travel and vacation ownership products, with resorts in the U.S., Hawaii, Mexico and the Caribbean.
Following completion of the spinoff, Vistana Signature Experiences will encompass 19 vacation ownership resorts and three “fractional residence properties.” The Starwood statement said “additional hotel asset inventory is expected to be transferred from Starwood as part of the transaction.”
The spinoff remains subject to the approval of the Starwood Hotels & Resorts Worldwide Inc. board of directors and the satisfaction of certain other customary conditions, including the effectiveness of the Form 10, the company said. And, “Starwood may, at any time until the closing of the separation, decide to abandon, modify or change the terms of the separation.”
Starwood has retained Citigroup Global Markets Inc. and Credit Suisse as financial advisers and Latham & Watkins LLP, based in Los Angeles with Manhattan offices, as legal counsel to advise on the planned spinoff.