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Apollo Group looking to buy HGVC [Merged]

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JIMinNC

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A couple of thoughts. How reliable is the NY Post? I did a search and the only thing I came up with was a premium “Street Insider” article titled Apollo looks to acquire HGVC and the NY Post article. I was under the impression that the NY Post was on the more tabloid side of newspapers.

I think we are jumping the gun here a bit. It didn’t say it was happening, but they were looking to. They are hearing it from one side. That doesn’t mean it’s a done deal or even eminent.

My impression of the NY Post is the same as yours, but there must be some fire where the smoke is because HGV stock is up 10% just today to over $31/share after trading at $26 late last week. It's even driving up Marriott Vacations Worldwide stock by 3%.
 

Tamaradarann

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When we owned with DRI at Kaanapali Beach Club, maintenance fees went up on average 8-9% per year, and was almost totally due to DRI increasing their management fee and administrative costs by double digits every year. The quality was also a solid notch or two below that of HGVC/Marriott/Westin, and KBC was one of the top-tier Diamond properties. They also eliminated internal exchanges with some other DRI properties in Hawaii as a way to try to force people to relinquish their deeds and buy their trust product. Just seemed like a slimy organization overall.

We stayed at the DRI Kaanapali Beach Club for 2 weeks in May. The resort has an excellent location and it customer service was good. We did have a problem with roaches, and they moved us quickly to another room with a better view which gets a plus in customer service.

We went to a presentation and we didn't find the pressure overly zealous, however, we have gone to so many presentations and own so many resale timeshares that we can usually fend off their pressure by saying we have enough vacation ownership already and don't need anymore. Their maintenance was high for the number of points that we would need for a week during prime seasons in Hawaii versus HGVC. We stay in Honolulu using our HGVC points with a maintenance cost of about $60/night. The maintenance for the their minimum package would have cost about $200/night.

Furthermore, we didn't like their timeshare model if we were going to buy. The Hawaii Trust Product that they were offering had properties in Las Vegas, Arizona, and California mixed in with Hawaii Properties so that even though you would be buying a Hawaii Timeshare Product it wasn't ownership that was based on Hawaii Property. While I understand from owners that the following scenario has not occurred yet I do foresee it happening: Most of us know that Hawaii is the most sort after location in timeshare systems. If they can sell trust shares based on available properties in Las Vegas, Arizona, and California as well as Hawaii since all of these properties are in the Hawaii Trust, the number of Hawaii Trust Owners that want to reserve in Hawaii during prime season will become higher than the number of units that are available to reserve in Resorts in Hawaii. Therefore, even though you OWN a unit in the Hawaii Trust you won't be able to reserve unless you book right at the 1 year booking opening date.
 

1Kflyerguy

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My impression of the NY Post is the same as yours, but there must be some fire where the smoke is because HGV stock is up 10% just today to over $31/share after trading at $26 late last week. It's even driving up Marriott Vacations Worldwide stock by 3%.

I checked Seeking Alpha, eTrade and other sites where I get financial news. They are all reporting the same news about Apollo, but most of these point back to the NY Post as the source of the news.

Will be curious to see if either HGV or Apollo make any sort of statement at some point.

I agree with others that merging with DRI would not be good new for current HGV owners.
 

Cyberc

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If HGV and DRI merges how would that effect availability?

In case the merger do happens and the maintenance fee starts to explode is there anyway we the members at each resort can vote or decide on another management company?
 

SmithOp

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We stayed at the DRI Kaanapali Beach Club for 2 weeks in May. The resort has an excellent location and it customer service was good. We did have a problem with roaches, and they moved us quickly to another room with a better view which gets a plus in customer service.

We went to a presentation and we didn't find the pressure overly zealous, however, we have gone to so many presentations and own so many resale timeshares that we can usually fend off their pressure by saying we have enough vacation ownership already and don't need anymore. Their maintenance was high for the number of points that we would need for a week during prime seasons in Hawaii versus HGVC. We stay in Honolulu using our HGVC points with a maintenance cost of about $60/night. The maintenance for the their minimum package would have cost about $200/night.

Furthermore, we didn't like their timeshare model if we were going to buy. The Hawaii Trust Product that they were offering had properties in Las Vegas, Arizona, and California mixed in with Hawaii Properties so that even though you would be buying a Hawaii Timeshare Product it wasn't ownership that was based on Hawaii Property. While I understand from owners that the following scenario has not occurred yet I do foresee it happening: Most of us know that Hawaii is the most sort after location in timeshare systems. If they can sell trust shares based on available properties in Las Vegas, Arizona, and California as well as Hawaii since all of these properties are in the Hawaii Trust, the number of Hawaii Trust Owners that want to reserve in Hawaii during prime season will become higher than the number of units that are available to reserve in Resorts in Hawaii. Therefore, even though you OWN a unit in the Hawaii Trust you won't be able to reserve unless you book right at the 1 year booking opening date.

Relax, the sky isn’t falling yet.

Look at the other merger, there still isn’t a consolidated points/trust system at Marriott/Vistana yet, and it may never happen.

I can’t imagine how they will merge DRI points with HGVC points.

If we choose to keep out Hawaii deeds they still have to allow us to book what we own right up to 1 week+ 9 months. Even now at 9 months we have to contend with other points owner booking Hawaii, it operates very similar to a trust. Airfares and travel distances keep Hawaii out of reach for most as an every year option.

Recall the earnings transcript about HGVC looking at a trust system, wonder if they knew about this offer already?

It will suck for me because I never intend to book what I own in Hawaii, I get better bang by point stretching smaller units and weekdays in club season.

Weren’t you thinking about selling anyway since you purchased a condo in Hawaii? Might be a good time to dump HGVC.


Sent from my iPad using Tapatalk Pro
 

csalter2

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As a Diamond owner, this would be a welcome addition. However, I would be surprised if Hilton allowed it to happen. Time will tell the story.

Westin, Hyatt Sheraton and Starwood owners better be glad they were taken over by Marriott and not Apollo. Apollo is totally profit focused and has given very little attention to owners ' needs based upon my experience.
 

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JIMinNC

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In case the merger do happens and the maintenance fee starts to explode is there anyway we the members at each resort can vote or decide on another management company?

In theory, yes, but I believe the boards at most HGV resorts are stacked with people supported by HGV's proxies. It would take a focused and concerted effort from owners to wrest control from HGV.
 

Ralph Sir Edward

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What will be the most interesting will be what happens with the affiliates.

They could choose to not stay with the combined entity. . .
 

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Somebody must think something might happen with VAC. Their stock is also up over 7% today to $97/share. It was as low as $83.50 last Thursday. I bought some that day at $85.
 

SueDonJ

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I don't see where in the article it says that this speculated move is spurring talk about Marriott Vacations Worldwide and/or Wyndham also being acquired? What am I missing?
 

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There’s discussion on HGVC thread as well. Hoping it’s just talk. Thankfully we own an affiliate only.
 

1Kflyerguy

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I believe HGV controls the voting for unsold inventory. So the extent a particular resort has lots of unsold units, it might be impossible to remove HGV or DRI if they succeed.

But I agree with SmithOp, no reason to panic at this point. There is still on independent confirmation of the offer, and no idea how HGV will respond. Apollo tried to buy ILG last year, and ultimately they lost out to Marriott Vacation Club. Its very possible Blackstone or even Hilton get back involved to protect the co-marketing agreement.
 

JIMinNC

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I don't see where in the article it says that this speculated move is spurring talk about Marriott Vacations Worldwide and/or Wyndham also being acquired? What am I missing?

From Seeking Alpha. JP Morgan thinks it's possible:


https://seekingalpha.com/news/3493372-jpmorgan-bumps-hilton-grand-vacations-marriott-vacations

JPMorgan bumps up Hilton Grand Vacations and Marriott Vacations

JPMorgan dives into the timeshare sector after saying the NY Post article on an offer for Hilton Grand Vacations (HGV +11.3%) feels real.

Marriott Vacations (VAC +5.5%) is upgraded by the firm to Overweight from Neutral and HGV goes to Neutral from Underweight.

Analyst Brand Montour notes that other private equity firms other than Apollo Global could have an interest in the sector.

The sell-side consensus on both HGV and VAC is Neutral.
 

pedro47

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I can remember years ago when RCI were rumored going to purchase Sunterra Resorts. But Sunterra was sold to Diamond International Resorts .
 

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But so far the only "official" speculation, from the NY Post, is that, "Apollo Global Management has told time-share operator Hilton Grand Vacations it wants to buy the $2.4 billion outfit, and the company is considering its next steps."

There is SO MUCH affiliation/acquisition/takeover stuff happening in the industry that the TUG boards are bleeding into each other all over the place! For now, at least until something more than a stock bump sends us into a tizzy, I'm going to merge the threads currently in the HGVC, Marriott and Diamond TUG forums into a single one on the HGVC forum.

Go here: Apollo Group looking to buy HGVC [Merged]

Have at it, folks. :)
 

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OMG!!! I've been doing so much research and looking to buy Hilton, but might not if DRI is taking over. This is not good. :(
 

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Wow...in reading reviews about this company the majority of respondents basically say their experience with this company is horrific at all levels. I hope it does not happen because what I have read so far indicates HGVC will not be the positive experience that caused so many of us to purchase HGVC.
 

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In the 4 plus years that we have been DRI Members we have seen improvements in DRI. The high pressure sales seem to be slowly going away. The last couple we have attended have been more laid back. MF's for the Hawaiian Collection have remained stable the last couple of years. DRI got into a bidding war and won buying the Modern Honolulu. Which they are slowly remodeling into timeshare Condos from Hotel Rooms. The Resorts we stayed how were in great shape. The Resort Staffs have been very friendly and helpful. DRI started a program that allows folks that own a traditional Deeded Week at an owned/managed DRI Resort to do an internal trade to stay at another DRI resort.
 

escanoe

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I am not familiar with Diamond resorts, how large are they compared to HGVC? As upgrades are a big part of HGVC sales, it seems alienating current owners would significantly undermine HGVC. I am a little concerned, but not near panic mode yet.
 

dayooper

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Ok, how is Marriott involved in this? Explain to me why Marriott’s stock is upgraded. Or is it just the Marriott forum members were talking about this and it was merged?
 

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As upgrades are a big part of HGVC sales, it seems alienating current owners would significantly undermine HGVC. I am a little concerned, but not near panic mode yet.

I am thinking the same thing. To me it seems that it would kill all current plans.
 

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I wonder if this is a tactic to get HGVC sales to nosedive and after a bad quarter, then they come in and buy at a lower stock price than what they offered?

Although I am still figuring out MVC, I was very relieved when Vistana was bought by MVC and not Diamond. MVC stock may be increasing because they will pick up HGVers jumping ship if Diamond takes over.
 
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SueDonJ

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Ok, how is Marriott involved in this? Explain to me why Marriott’s stock is upgraded. Or is it just the Marriott forum members were talking about this and it was merged?

Post #22 in this thread was originally posted as a new thread on the Marriott forum, first we'd seen of it. JIMinNC mentioned the stock bump but I don't think there's been anything "official" mentioned about Marriott being involved. :shrug:

I merged that thread and another started on the TUG Diamond forum into this one on the HGVC forum.
 

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The financial news reports that the Timeshare Industry, including Marriott and Wyndam jumped the takeover news. That is not uncommon, as people and companies take a second look at the industry with buy out opportunities.
 
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