Hilton (HLT) to Acquire Graduate Hotels Brand for $210 Million

Core Insights - Hilton Worldwide Holdings Inc. has signed a contract to acquire the Graduate Hotels brand for $210 million, expected to close in Q2 2024, enhancing its brand portfolio and market reach [1][2] - The acquisition includes all global rights to the Graduate Hotels brand, with AJ Capital Partners retaining ownership of over 35 properties under long-term franchise agreements with Hilton [2] - Hilton's expansion strategy includes opening 395 new hotels in 2023, achieving a net unit growth of 4.9%, and a record pipeline of nearly 3,274 hotels, indicating strong growth potential [3] Acquisition Details - The acquisition will allow Hilton to enter franchise agreements for existing and future Graduate Hotels, with bookings through Hilton channels expected to start in late 2024 [2] - Customers booking through Hilton will gain access to benefits such as exclusive discounts and participation in the Hilton Honors loyalty program [2] Expansion Strategy - Hilton's focus on market expansion and product diversification is evident, with over half of its development pipeline located outside the U.S. [3] - The company achieved an 8.6% year-over-year increase in room additions, with a total of nearly 63,000 new rooms added in 2023 [3] - Hilton expects net unit growth of 5.5% to 6% for 2024, reflecting its ongoing commitment to growth [3] Stock Performance - Hilton's shares have increased by 34.9% over the past six months, outperforming the Zacks Hotels and Motels industry's growth of 24.5% [4]