Hilton Grand Vacations Completes $293 Million Term Securitization

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Hilton Grand Vacations completes $293 million securitization of vacation ownership loans

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• Hilton Grand Vacations Inc. has completed a $293 million securitization of both HGV and legacy Diamond vacation ownership loans through Hilton Grand Vacations Trust 2023-1. The transaction marks the first issuance of both deeded and trust-based collateral combined under the HGVT issuance shelf. Investor demand was strong, peaking at over 6x subscription. Proceeds of the issuance will be used to pay down debt and for other general corporate purposes.

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ORLANDO, Fla.--(BUSINESS WIRE)-- Hilton Grand Vacations Inc. (NYSE:HGV) announces today the completion of a $293 million securitization of both HGV and legacy Diamond vacation ownership loans through Hilton Grand Vacations Trust 2023-1 (“HGVT”). Three classes of Notes were issued by HGVT, including approximately $187 million of Class A Notes, approximately $79 million of Class B Notes, and approximately $27 million of Class C notes.

The Class A Notes have a coupon rate of 5.72%, the Class B Notes have a coupon rate of 6.11%, and the Class C Notes have a coupon rate of 6.94%, for an overall weighted average coupon rate of 5.94%, and an overall advance rate of 97%.

“We’re pleased with the execution of our 2023 ABS offering, and we continue to see strong support from the capital markets,” said Dan Mathewes, chief financial officer of Hilton Grand Vacations. “Investor demand built quickly, peaking at over 6x subscription. At final pricing, we achieved the tightest weighted-average spread for any Timeshare ABS issuance in the past year.”

Proceeds of the issuance, net of fees, will be used to pay down debt and for other general corporate purposes.

This transaction marks the first issuance of both deeded and trust-based collateral combined under the HGVT issuance shelf. The transaction saw significant peak order demand from over 30 unique investors.

Deutsche Bank Securities served as the structuring lead manager and joint bookrunner, along with Atlas SP, Barclays, BofA Securities, MUFG and Wells Fargo Securities. Academy Securities, Citizens Capital Markets, Regions Securities LLC, and Truist Securities served as a co-managers. Alston and Bird LLP represented HGV as issuer counsel.

The Notes were offered in a private placement within the U.S. to qualified institutional buyers pursuant to Rule 144A and outside the U.S. in accordance with Regulation S under the Securities Act of 1933, as amended. This press release is an announcement of record only and does not constitute an offer to sell or the solicitation of an offer to buy the Notes, all of which have been sold. Certain classes of the transaction were rated by Standard & Poor’s Financial Services LLC (S&P) and Moody’s Investor Service, Inc (Moody’s).

Important Notice

The statements in this press release may include forward-looking statements within the meaning of Section 27A of the Securities Act and Section 21E of the Exchange Act. Words such as “may,” “will,” “seeks,” “anticipates,” “believes,” “estimates,” “expects,” “plans,” “intends,” “would,” “could,” or similar expressions indicate a forward-looking statement; however, not all forward-looking statements include these identifying words. These forward looking statements involve substantial risks and uncertainties that could cause the outcome to be materially different, including the material impact of the COVID-19 pandemic on the Company’s business, operating results and financial condition, general economic conditions, the actual timing and status of, or any disruptions to, the re-opening of the Company’s properties, as well as those factors that are discussed under the “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” sections of the Company’s most recent Annual Report on Form 10-K and any subsequent Quarterly Reports on Form 10-Q and Current Reports on Form 8-K that may update or supplement such disclosure. These factors should not be construed as exhaustive and should be read in conjunction with the other cautionary statements that are included in the Company’s other filings with the Securities and Exchange Commission. Further, forward-looking statements speak only as of the date they are made, and the Company undertakes no obligation to update or revise forward-looking statements to reflect changed assumptions, the occurrence of unanticipated events or changes to future operating results over time, except as required by law.

About Hilton Grand Vacations Inc.

Hilton Grand Vacations Inc. (NYSE:HGV) is recognized as a leading global timeshare company. With headquarters in Orlando, Florida, Hilton Grand Vacations develops, markets, and operates a system of brand-name, high-quality vacation ownership resorts in select vacation destinations. As one of Hilton’s 22 premier brands, Hilton Grand Vacations has a reputation for delivering a consistently exceptional standard of service, and unforgettable vacation experiences for guests and more than 520,000 Club Members. Membership with the Company provides best-in-class programs, exclusive services and maximum flexibility for our Members around the world. For more information, visit https://corporate.hgv.com.

View source version on businesswire.com: https://www.businesswire.com/news/home/20230810523077/en/

Investor Contact:

Mark Melnyk

407-613-3327

mark.melnyk@hgv.com

Media Contact:

Lauren George

407-613-8431

lauren.george@hgv.com

Source: Hilton Grand Vacations Inc.

FAQ

What is the purpose of the securitization?

The proceeds will be used to pay down debt and for other general corporate purposes.

What is the coupon rate for the Class A Notes?

The Class A Notes have a coupon rate of 5.72%.

Who served as the structuring lead manager and joint bookrunner?

Deutsche Bank Securities served as the structuring lead manager and joint bookrunner.

Were the Notes offered to qualified institutional buyers?

Yes, the Notes were offered in a private placement within the U.S. to qualified institutional buyers.