Platinum Equity is buying Wyndham Worldwide Corp.’s (NYSE: WYN) European vacation rental business for approximately $1.3 billion. The deal is expected close in the second quarter of 2018.

Wyndham’s European vacation rental business is one of the largest managers of holiday rentals in Europe. The target manages more than 110,000 unites across more than 25 countries. As part of the deal, the European vacation rental business has entered a 20-year agreement to pay a royalty fee of one percent of net revenue to Wyndham’s hotel business for the right to use the by Wyndham Vacation Rentals name brand. The vacation rentals business operates more than 24 local brands, including:, James Villa Holidays, Landal GreenParks, Novasol and Hoseasons.

In August 2017, Wyndham announced its intention to explore strategic alternatives for the European vacation rental division with news that the company planned to separate its hotel business from its vacation ownership and time share exchange businesses. The vacation rentals business generates approximately $750 million in annual revenue and $130 million in Ebitda.

“Along with our planned separation and recently announced acquisition of La Quinta’s franchising and management businesses, this is another important step in the evolution of our company,” states Wyndham CEO Stephen Holmes. “Our goal has always been to position [the European vacation rental brands] for continued long-term growth. We conducted a rigorous strategic review process that generated strong interest from multiple parties, and we were pleased to find the right buyer.”

Founded in 1995 by Detroit Pistons owner Tom Gores, Platinum Equity is a Los Angeles-based private equity firm with more than $6 billion in capital under management. The firm has completed more than 200 acquisitions since inception. The Wyndham acquisition marks as the third deal for Platinum Equity in February alone. The PE firm backed Terratest’s purchase of construction services firm Geostructures Inc. and acquired packaging label maker WS Packaging Group.

Deutsche Bank (NYSE: DB) and Goldman Sachs (NYSe: GS) are serving as financial advisers to Wyndham Worldwide, while Kirkland & Ellis International LLP and Dechert LLP are serving as legal counsel. Latham & Watkins is acting as legal adviser to Platinum Equity, while Bank of America Merrill Lynch is leading financing (NYSE: BAC).