Hilton Grand Vacations Inc., a Hilton-affiliated vacation home ownership brand, agreed Monday to acquire Bluegreen Vacations in an all-cash transaction for $75 per share, or a total consideration of approximately $1.5 billion.
“I’m excited to enhance the breadth and quality of our already best-in-class vacation ownership and experiences offering with the announcement of our agreement to acquire Bluegreen Vacations,” Mark Wang, president and CEO of Hilton Grand Vacations, said in a news release announcing the deal. “Bluegreen Vacations has a strong track record of demonstrated organic growth, a dedicated customer base of more than 200,000 members, and boasts key lead-generating strategic partnerships that will broaden our reach and diversify our tour flow.”
The acquisition will grow Hilton Grand Vacations' membership base by an additional 200,000 members and its resort portfolio from 150 to nearly 200 properties across eight new states. An estimated $100 million in cost synergies is expected to be achieved within the first 24 months of the deal’s closing, and is expected to generate future revenue synergies between $75 million to $100 million.
In addition to the deal, Hilton Grand Vacations signed an exclusive 10-year marketing agreement with Bass Pro Shops. Bluegreen Vacations currently owns 51% of a joint venture with Bass Pro Shops that includes four outdoor-themed resorts.
“Our new partnership with Hilton Grand Vacations is one of the most exciting and important in our history,” Johnny Morris, founder of Bass Pro Shops, said in the release. “It will give both of our legendary brands the ability to introduce many more people to the great outdoors and happy memories they will never forget.”
C. Patrick Scholes, managing director of lodging and leisure equity research at Truist Securities, said in a note to investors that plugging Bluegreen into Hilton Grand Vacations' marketing system should bode well.
“One of the major challenges with an independent Vacation Ownership company like [Bluegreen Vacations] is that they do not have a well-recognized brand like [Hilton Grand Vacations] does and subsequently customer acquisition cost is significantly higher,” he said.