Hilton Grand Vacations Launches $400M Term Loan A Offering

Hilton Grand Vacations Secures New Term Loan A

Hilton Grand Vacations Inc. (NYSE:HGV) recently announced a significant financial development: the successful issuance of a $400 million Senior Secured Term Loan A. This loan, which matures in January 2028, is priced at SOFR plus 175 basis points. Such a financial maneuver aims to strategically bolster the company’s financial health and operational capacity.

Purpose of the Term Loan A

The funds acquired through this Term Loan A issuance will primarily be allocated towards the partial pre-payment of the existing $1.3 billion Term Loan B, which is set to mature in August 2028. This move not only demonstrates Hilton Grand Vacations' proactive approach to managing its debt but also reflects the company's commitment to maintaining a robust balance sheet.

Strategic Benefits and Savings

By executing this loan effectively, Hilton Grand Vacations positions itself to lower overall interest expenses. Dan Mathewes, the president and chief financial officer of Hilton Grand Vacations, remarked on the positive impact this decision has on the company’s financial strategy. He stated, "With impressive execution, we continue to lower our interest costs and optimize our balance sheet, positioning us for the future." Furthermore, this financing arrangement is expected to generate nearly $10 million in interest savings over the term of the loan.

High-Profile Financial Partnerships

Bank of America played a crucial role in this transaction as the lead arranger, while law firm Simpson Thacher & Bartlett LLP served as issuer counsel for Hilton Grand Vacations. This collaboration with reputable financial institutions underscores the confidence in the company’s operational direction and future prospects.

About Hilton Grand Vacations Inc.

Hilton Grand Vacations Inc. is widely recognized as a leading global timeshare company and functions as the exclusive vacation ownership partner of the Hilton brand. Strategically headquartered in Orlando, Florida, the company specializes in developing, marketing, and managing a portfolio of brand-name, high-quality vacation ownership resorts situated in sought-after travel destinations. With an impressive reputation for delivering exceptional service, Hilton Grand Vacations strives to provide unforgettable experiences for guests and its community of approximately 720,000 Club Members.

Membership Advantages

Membership in Hilton Grand Vacations not only offers a gateway to idyllic vacation experiences but also grants members access to best-in-class programs and exclusive services. This approach ensures maximum flexibility for Club Members worldwide, allowing them to craft personalized travel experiences that meet their unique preferences.

Conclusion

In light of the recent financial developments, Hilton Grand Vacations is set on a promising path. The issuance of this Term Loan A reflects a strategic endeavor to enhance its financial structure while preparing the company for future growth. By prioritizing cost savings and operational effectiveness, Hilton Grand Vacations demonstrates its unwavering commitment to providing excellence in the vacation ownership industry.

Frequently Asked Questions

What is the purpose of the new Term Loan A?

The $400 million Term Loan A is primarily aimed at partially pre-paying the existing Term Loan B, enhancing the company's financial flexibility.

How will this loan impact Hilton Grand Vacations financially?

This loan is expected to lower overall interest costs and save the company nearly $10 million in interest expenses over its duration.

Who was involved in arranging the loan?

Bank of America served as the lead arranger for the Term Loan A, highlighting its importance in facilitating this significant financial move.

What are the benefits of being a member of Hilton Grand Vacations?

Members enjoy access to exclusive services, flexible vacation options, and a network of high-quality vacation ownership resorts worldwide.

Where is Hilton Grand Vacations based?

Hilton Grand Vacations is headquartered in Orlando, Florida, strategically positioned to oversee its global vacation ownership operations.

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