PARSIPPANY, N.J. — Wyndham Worldwide has announced plans to spin off the company’s hotel business. Wyndham Hotel Group will become a new, publicly traded pure-play hotel company with a portfolio of renowned brands, while Wyndham Vacation Ownership will be the world’s largest publicly traded timeshare company and be joined with Wyndham Destination Network. The company will also explore strategic alternatives for its European rental brands.
The transaction is expected to increase the fit, focus and strategic flexibility of the two post-spin companies, allow each company to maintain a sharper focus on its core business and growth opportunities, facilitate future capital raising as needed for the two companies and better position for each to make the changes necessary to respond to developments in its markets.
The two companies intend to enter into long-term exclusive license agreements to retain their affiliation with the Wyndham Rewards program, as well as continued collaboration on key inventory sharing and customer cross-sell initiatives. The corporate names of the post-spin public companies have not yet been decided.
The vacation-ownership company and the hotel company will have separate boards of directors. Geoff Ballotti, current CEO of Wyndham Hotel Group, will continue to lead the hotel company as president and CEO. Michael Brown, current CEO of Wyndham Vacation Ownership, will continue to lead the timeshare company as president and CEO.
The transaction, which is expected to be tax-free to Wyndham Worldwide and its shareholders, will be effected through a pro-rata distribution of the new hotel company’s stock to existing Wyndham Worldwide shareholders. The transaction is expected to be completed in the first half of 2018.