Marriott International Inc. intends to spin off its timeshare business into a separate company.
While announcing its earnings for the fourth quarter of 2010, Marriott annnounced that it will spin off its Marriott Vacation Club International timeshare business into a separate company. The new company will focus exclusively on marketing timeshare and fractional ownership properties under the Marriott and Ritz Carlton brands.
In a press release, Marriott International chairman and chief executive officer, J.W. Marriott, Jr., stated that:
"The transaction will permit both companies to tailor their business strategies to best address market opportunities in their respective industries. The new timeshare company will be positioned to expand faster over time while Marriott International will further advance its longstanding strategy of separating real estate from management and franchise operations. With two public companies, shareholders will be able to pursue investment goals in either or both companies rather than one combined organization."
Timeshare sales have slowed in recent years as a result of the worldwide economic struggles. As of year-end 2010, Marriott had roughly $1.5 billion worth of unsold timeshare assets.
Marriott claims that timeshare owners will see no immediate changes in day-to-day operations as a result of the move.