Feb. 26--Hotel giant Hilton Worldwide said Friday that it plans to spin off its timeshare operation and most of its real estate business into separate companies.
The bulk of Hilton Worldwide's real estate business -- which includes about 70 hotels and 35,000 rooms -- will become a publicly traded real estate investment trust.
The timeshare business, Hilton Grand Vacations, will become a separate, publicly traded company and will manage about 50 club resorts in the U.S. and Europe. This company will also have an exclusive, long-term licensing agreement with Hilton Worldwide to operate, market and sell under the Hilton Grand Vacations brand.
In a statement, Hilton Worldwide Chief Executive Christopher Nassetta said the spinoff will result in three "pure-play" companies that can focus on "growth opportunities, as well as capital market and tax efficiencies."
After the spinoff, Hilton Worldwide will be an operating company, focusing mainly on the management, branding and franchise business. It will also own some hotels.
The company said the spinoffs will not require a vote from shareholders and are intended to boost long-term shareholder value. Hilton Worldwide's board of directors must give final approval.
The spinoffs are expected to be completed by the end of the year.
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