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Marriott Vacations to buy ILG for $4.7bn
Marriott Vacations Worldwide has agreed to buy timeshare operator ILG for around $4.7bn in a cash and stock deal.
Under the terms of the deal, ILG shareholders will receive $14.75 in cash and 0.165 shares of Marriott Vacations for each of their shares.
The transaction is expected to be accretive to Marriott's adjusted earnings per share within the first year after closing, with annual run-rate cost savings of at least $75m within two years of completion. On a pro-forma basis, the combined entity would have 2017 adjusted earnings before interest, taxes, depreciation and amortisation of $737m.
Marriott said ILG will contribute strong and recurring revenue streams that will allow the combined group to maintain flexibility for continued organic growth, strategic acquisitions, continued capital returns to shareholders and de-levering.
Stephen P. Weisz, president and chief executive officer of Marriott Vacations, said: "This transaction will combine two of the premier global vacation ownership companies to create a more diversified company with significantly enhanced marketing potential and scale to drive sales growth and value for both MVW and ILG shareholders.
"With ILG, we will bring together six world-class vacation ownership brands under one licensing relationship with Marriott International, which will enable us to leverage high-value marketing and sales channels, including those provided by Marriott International's platforms, and enhance the benefits of our access to Marriott International's loyalty programs, call transfer and hotel linkage programs. We will also diversify our vacation ownership business with the addition of the Hyatt Vacation Ownership platform, providing exciting growth opportunities outside of the Marriott and Vistana platforms. Additionally, with ILG's leading exchange networks, we will gain recurring, high-margin revenue streams."