Hilton Grand Vacations talks $300 million eight-year notes to yield 6¼%-6½%; pricing Friday

By Paul A. Harris

Portland, Ore., Nov. 17 – Hilton Grand Vacations Inc. talked its $300 million offering of eight-year senior notes (Ba3/BB) to yield 6¼% to 6½%, according to market sources.

Official talk comes tight to initial price guidance in the mid 6% area, a trader said.

Books close at 10:30 a.m. ET on Friday, and the deal is set to price thereafter.

Goldman Sachs & Co., BofA Merrill Lynch, Deutsche Bank Securities Inc., Barclays, J.P. Morgan Securities LLC, SunTrust Robinson Humphrey Inc. and Wells Fargo Securities LLC are the joint bookrunners for the Rule 144A and Regulation S with registration rights offering.

MUFG and U.S. Bancorp Investments Inc. are the co-managers.

The notes become callable after five years at par plus 50% of the coupon.

The deal is coming in conjunction with Hilton Worldwide Holdings Inc.'s spinoff of its timeshare division, Hilton Grand Vacations. The new entity, Park Hotels & Resorts, will be an independent, publicly traded company.

Hilton Grand Vacations will receive no proceeds, according to the syndicate source. Park Hotels & Resorts, the selling security holders, will enter into a debt-for-debt exchange agreement in which the security holders will exchange Park debt for the new notes, and will then sell the new notes to the initial purchasers for cash.

The issuing entity will be Hilton Grand Vacations Borrower LLC.

Hilton Grand Vacations is an Orlando, Fla.-based developer, marketer and operator of vacation ownership resorts in select vacation destinations.

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