Apollo-backed Diamond Resorts is reportedly in talks to merge with timeshare properties company ILG.
The potential merger comes as Diamond Resorts looks for an alternative to a sale, according to Reuters.
A deal would add more than 400 of Diamond Resorts’ vacation destinations in 35 countries to ILG’s 250 managed resorts in 80 countries, and a transaction could be valued at more than $3.5bn including debt.
Apollo backed Diamond Resorts for around $2.2bn in a take-private deal back in 2016. It submitted an all cash offer of $30.25 per share at the time, representing a 26 per cent premium over its closing price on 28 June.
The deal comes as the timeshare industry seeks to improve its occupancy rates and shed its reputation of locking customers into complex contracts they do not understand.
ILG has a market capitalisation of $4.1bn and its debt stood at $570m as of the end of December. It is also reportedly exploring a potential sale to Marriott Vacations.
News of the potential merger comes just a day after AltAssets reported that Apollo-backed Claire’s Accessories had filed for bankruptcy in the hope of reducing its debt by around $1.9bn.
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