BBX Capital Corporation to Become Pure-Play
Bluegreen Vacations Holding Company Following Spin-Off
BBX Capital Corporation (NYSE: BBX) (OTCQX: BBXTB) (“BBX
Capital” or the “Company”) announced today its intention to spin
off its subsidiary, BBX Capital Florida LLC (“New BBX Capital”), in
order to separate the business, activities and investments of the
Company into two separate, publicly-traded companies: (i) the
Company, which will continue to hold its investment in Bluegreen
Vacations Corporation (“Bluegreen Vacations”), a leading vacation
ownership company that markets and sells vacation ownership
interests and manages resorts in popular leisure and urban
destinations, and (ii) New BBX Capital, which will continue to hold
or will hold at the time of the spin-off all of the Company’s other
businesses and investments, including BBX Capital Real Estate LLC,
BBX Sweet Holdings, LLC and Renin Holdings, LLC. As a result of the
spin-off, the Company will cease to have any ownership interest in
New BBX Capital and will become a “pure-play” Bluegreen Vacations
holding company.
Prior to the spin-off, New BBX Capital will be converted from a
Florida limited liability company into a Florida corporation. The
spin-off is expected to be effected by the distribution of shares
of New BBX Capital’s common stock to the Company’s shareholders.
Shareholders of the Company will be distributed one share of New
BBX Capital’s Class A Common Stock for each share of the Company’s
Class A Common Stock and one share of New BBX Capital’s Class B
Common Stock for each share of the Company’s Class B Common Stock,
in each case, held of record as of the close of business on the
record date for the distribution to be determined by the Company’s
Board of Directors. It is currently expected that applications will
be made for New BBX Capital’s Class A Common Stock and Class B
Common Stock to trade on the OTCQB and/or OTCQX. The receipt of
shares of New BBX Capital’s Class A Common Stock and/or Class B
Common Stock in connection with the spin-off will be a taxable
transaction to the Company’s shareholders. The Company’s
shareholders’ proportionate ownership and voting interests in the
Company will not be impacted by the spin-off. Further, Bluegreen
Vacations’ Common Stock (NYSE: BXG) will continue to trade on the
New York Stock Exchange.
The Company believes that its investment in Bluegreen has
distinct characteristics from its other investments and that
separating the Company’s investment in Bluegreen from its other
investments will, among other things, allow each of the Company and
New BBX Capital to adopt strategies and pursue objectives
appropriate to such company, independent of the other, better
position each company to maximize value over the long-term, bring
greater clarity to the marketplace as to each company’s core
competencies, and better position each company to optimize capital
deployment and investment strategies necessary to advance their
respective interests. “We are very pleased to make this
announcement today as we believe that the proposed spin-off
reflects our commitment to the strategy of building long term value
for our shareholders,” said Alan B. Levan, Chairman and Chief
Executive Officer of the Company.
In connection with the spin-off, the Company intends to change
its name to “Bluegreen Vacations Holding Corporation” and for New
BBX Capital to assume the name “BBX Capital Corporation.” In
addition, the Company will in connection with the spin-off issue a
$75.0 million note payable to New BBX Capital that will accrue
interest at a rate of 6% per annum and require payments of interest
on a quarterly basis. Under the expected terms of the note, the
Company will have the option in its discretion to defer payments
under the note, with amounts deferred to accrue interest at a
cumulative, compounded rate of 8% per annum, and all outstanding
amounts will become due and payable in five years or earlier upon
certain other events. In connection with the spin-off, the Company
will also make cash contributions to New BBX Capital and it is
currently expected that following the spin-off the Company will
hold approximately $25.0 million in cash and cash equivalents (not
including the cash and cash equivalents held by its subsidiary,
Bluegreen Vacations).
Following the spin-off of New BBX Capital, the Company will
continue to be a publicly-traded holding company whose primary
assets will then be its investment in Bluegreen Vacations and
approximately $25.0 million in cash and cash equivalents and whose
primary liabilities are expected to be approximately $141.3 million
in outstanding debt obligations, including $66.3 million in junior
subordinated debentures payable by Woodbridge, its wholly-owned
subsidiary, and the $75.0 million note payable to New BBX Capital
discussed above. The Company will have limited operations following
the spin-off and based on such limited operations, the Company
expects to incur approximately $8.5 million of interest expense
associated with its debt obligations and $2.0 - $3.0 million in
expected expenses, which include ongoing executive compensation
costs, general and administrative expenses, and estimated costs
associated with being a public company. In addition, compensation
costs associated with the vesting of unvested shares of Company
restricted stock that were previously granted to executives of the
Company may be recognized in future periods.
It is currently anticipated that the Company’s current Directors
will resign and become Directors of New BBX Capital and that
certain of Bluegreen Vacations’ current Directors will be appointed
to fill those vacancies and become Directors of the Company
following the spin-off. Alan B. Levan, President and CEO, John E.
Abdo, Vice Chairman, and Ray Lopez, Chief Operating Officer and
Chief Financial Officer of Bluegreen Vacations, will continue to
serve as officers of Bluegreen Vacations as well as the Company.
Alan Levan and John E. Abdo will also serve as Chairman and Vice
Chairman of New BBX Capital, and Jarett Levan will serve as its
President and CEO of New BBX Capital.
Completion of the spin-off is subject to a number of conditions,
including, without limitation, (i) approval of the spin-off in the
contemplated manner by the Company’s shareholders, (ii) final
approval of the Company’s Board of Directors, and (iii) the
effectiveness of a Registration Statement on Form 10 to be filed by
New BBX Capital with the Securities and Exchange Commission (the
“SEC”) and the mailing of the information statement which will form
a part thereof. The Company intends to hold a special meeting of
its shareholders for the purpose of approving the spin-off and the
Company’s contemplated name change. Notwithstanding any approval of
the spin-off by the Company’s shareholders or the satisfaction of
any of the other closing conditions, the Company may, in the sole
discretion of its Board of Directors, abandon the spin-off at any
time prior to its consummation.
About BBX Capital
Corporation: BBX Capital Corporation (NYSE: BBX) (OTCQX:
BBXTB) is a Florida-based diversified holding company whose
principal investments include Bluegreen Vacations Corporation
(NYSE: BXG), BBX Capital Real Estate, BBX Sweet Holdings, and
Renin. For additional information, please visit
www.BBXCapital.com.
About Bluegreen Vacations
Corporation: Bluegreen Vacations Corporation (NYSE: BXG)
is a leading vacation ownership company that markets and sells
vacation ownership interests (VOIs) and manages resorts in popular
leisure and urban destinations. The Bluegreen Vacation Club is a
flexible, points-based, vacation ownership plan with approximately
221,000 owners, 68 Club and Club Associate Resorts and access to
more than 11,350 other hotels and resorts through partnerships and
exchange networks as of March 31, 2020. Bluegreen Vacations also
offers a portfolio of comprehensive, fee-based resort management,
financial, and sales and marketing services, to or on behalf of
third parties. Bluegreen is approximately 93% owned by BBX Capital
Corporation.
Forward-Looking Statements:
This press release contains forward-looking statements based on
current expectations that involve a number of risks and
uncertainties. All opinions, forecasts, projections, future plans
or other statements, other than statements of historical fact, are
forward-looking statements. The forward-looking statements in this
press release are also forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933, as amended,
and Section 21E of the Securities Exchange Act of 1934, as amended.
Forward-looking statements involve risks, uncertainties and other
factors, many of which are beyond the Company’s control, that may
cause actual results or performance to differ from those set forth
or implied in the forward-looking statements. These risks and
uncertainties include, without limitation, risks associated with
the contemplated spin-off, including that actual plans, actions and
results relating to the spin-off may differ materially from current
expectations, that the spin-off may not be consummated on the
contemplated terms, or at all, that, if consummated, the spin-off
may not result in the benefits anticipated and may result in
disruption to business operations due to focus on the spin-off, and
uncertainties related to the tax effects of the spin-off to the
Company’s shareholders. In addition, reference is also made to
other risks and factors detailed in reports filed by the Company
with the SEC, including the Company’s Annual Report on Form 10-K
for the year ended December 31, 2019 and the Company’s Quarterly
Report on Form 10-Q for the quarter ended March 31, 2020, which may
be viewed on the SEC's website at www.sec.gov or in the Investor Relations section
of the Company’s website at www.BBXCapital.com. The Company cautions that the
foregoing factors are not exclusive. You should not place undue
reliance on any forward-looking statement, which speaks only as of
the date made. The Company does not undertake, and specifically
disclaims any obligation, to update or supplement any
forward-looking statements.
Additional Information and Where to
Find It; Participant Information: The proposed spin-off
and related name change will be submitted to the shareholders of
the Company for their consideration. In connection therewith, the
Company will file a proxy statement with the SEC. The definitive
proxy statement will be mailed to the Company's shareholders when
available. SHAREHOLDERS ARE URGED TO READ THE PROXY STATEMENT
CAREFULLY AND IN ITS ENTIRETY WHEN AVAILABLE BECAUSE IT WILL
CONTAIN IMPORTANT INFORMATION ABOUT THE PROPOSED SPIN-OFF.
The Company and its directors and executive officers may, under
the rules of the SEC, be deemed to be participants in the
solicitation of proxies from the Company’s shareholders in
connection with the proposed spin-off. Information regarding the
Company's directors and executive officers, including their names
and interests in the Company, is set forth in Amendment No. 1 to
the Company’s Annual Report on Form 10-K for the year ended
December 31, 2019, which was filed with the SEC on April 29, 2020.
Additional information regarding persons who may be deemed to be
participants in the solicitation of proxies in respect of the
proposed spin-off, including their names and interests in the
Company, will be contained in the proxy statement to be filed by
the Company with the SEC and mailed to the Company’s shareholders
when available.
Copies of all documents filed by the Company with the SEC are
available, free of charge, on the SEC's website at www.sec.gov and in the Investor Relations section
of the Company’s website at www.bbxcapital.com. In addition, the Company’s
shareholders may obtain copies of the documents filed by the
Company with the SEC at no charge by contacting the Company’s
Investor Relations Department by mail at BBX Capital Corporation,
401 East Las Olas Boulevard, Suite 800, Fort Lauderdale, Florida
33301, or by phone at 954-940-5300.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20200617005781/en/
Investor Relations: Leo Hinkley,
Managing Director, Investor Relations Officer 954-940-5300, Email:
LHinkley@BBXCapital.com
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