Hilton to Sell Some Hotels in Europe

Hilton Hotels Corp., the second-biggest U.S. hotel company by revenue, said it was selling 10 European hotels and was considering the sale of the Scandic lodging group that were all part of a February purchase.

The 10 hotels for sale comprise three in Germany, two in France, two in Spain and hotels in Belgium, Luxembourg and Switzerland, Beverly Hills-based Hilton said. The Scandic brand consists of 130 hotels, most of which are leased properties located primarily in Scandinavia.

Hilton has been selling its real estate assets to generate cash as it focuses on managing brands.

The company acquired the European hotels and Scandic when it bought Hilton Group, a London company that operated Hilton hotels outside the U.S., for $5.7 billion in February. The purchase reunited the companies for the first time since 1966.

The hotel sales could be worth $2 billion, William Truelove, a UBS Securities analyst, said in a note to investors.

Truelove said Hilton’s sale of Scandic “would be a big positive as it eliminates a majority of Hilton’s lease operations” that lock the company into payments to the hotel owners.

Separately Wednesday, Hilton said it completed the sale of a chain of health clubs it acquired in the Hilton Group purchase. The 24 LivingWell Premier fitness clubs in Britain were sold to Bannatyne Fitness for $171.4 million. Hilton also completed the sale of three Australian health clubs to Fitness First Australia $20.95 million.

Shares of Hilton fell 34 cents to $24.31.