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Hilton Contact: Marc Grossman Park Place Contact: Geoffrey Davis
310-205-4030 702-699-5037
310-205-4541
Kathy Shepard
310-205-7676 Scott LaPorta
702-699-5000
310-205-4331
HILTON COMPLETES SPIN-OFF OF GAMING OPERATIONS
PARK PLACE ENTERTAINMENT ACQUIRES MISSISSIPPI OPERATIONS OF GRAND CASINOS, INC.
BEVERLY HILLS, Calif., December 31, 1998 -- Hilton Hotels Corporation
(NYSE:HLT) today completed the separation of its gaming and lodging
businesses -- via a tax-free distribution of its casino gaming operations to
shareholders, creating a newly formed gaming company named Park Place
Entertainment Corporation (NYSE:PPE). Concurrently, Park Place Entertainment
acquired the three Mississippi gaming operations of Grand Casinos, Inc.
(NYSE:GND), making it the world's largest casino gaming company. In the
Grand merger, Park Place has assumed approximately $565 million of debt and
issued shares of Park Place to Grand shareholders in a ratio of one share of
Park Place for each share of Grand.
Hilton shareholders of record at the close of business on December 23,
1998 will receive one share of Park Place common stock for each share of
Hilton common stock they own. An estimated 260.8 million shares of Park
Place will be distributed to Hilton shareholders to effectuate the spin-off
and an additional 42.3 million shares of Park Place will be issued to Grand
shareholders to effectuate the merger. ChaseMellon Shareholders Services, LLC
is the transfer agent.
The transactions were approved in November by shareholders of both
Hilton and Grand Casinos, Inc. Approvals have also been received from casino
gaming regulators in Nevada, New Jersey, Mississippi, Louisiana, Australia
and Uruguay.
Concurrent with the closing of the transactions, Stephen F. Bollenbach
becomes chairman of the board of Park Place Entertainment, while remaining
president and chief executive officer of Beverly Hills-based Hilton Hotels
Corporation. Arthur Goldberg, currently president - gaming operations for
Hilton Hotels, becomes president and chief executive officer and a director
of Park Place Entertainment. He remains on Hilton's board of directors.
Additionally, Lyle Berman current chairman of the board of Grand Casinos,
Inc. has joined the board of Park Place Entertainment.
-more-
Hilton Business Separation
2-2-2-2
Hilton Hotels Corporation is one of the world's foremost lodging
companies. The company owns, manages or franchises approximately 250 hotels
in the United States, Canada and Mexico, including ownership of some of the
world's most renowned properties, such as the Waldorf=Astoria, Hilton San
Francisco and Towers, Hilton Hawaiian Village and Chicago's Palmer House
Hilton. Hilton will continue to pursue a growth strategy centered on
acquiring full-service hotels in markets seeing little new supply. In 1998,
Hilton purchased approximately $950 million of hotels at attractive prices.
The company also will continue aggressively building its franchise program in
the U.S., Canada and Mexico, which will include the company's successful
Hilton Garden Inn program, which is expected to have 200 hotels open or under
contract by 2000.
Park Place Entertainment is the world's largest gaming company, as
measured by casino square footage and revenues, and is the only casino gaming
company with a leading presence in Nevada, New Jersey and Mississippi--the
three largest gaming markets in the U.S. In 1999, the company will own or
have an interest in 18 gaming properties located throughout the United States
and in Australia and Uruguay, with a total of 1.4 million square feet of
casino space and more than 23,000 hotel rooms.
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