Hilton (HLT) Raises $2.3 Billion in IPO
Shares of Hilton Worldwide Holdings Inc. (HLT) closed up +1.50 or +7.50 percent to $21.50 per share on Thursday, after the company had an initial public offering of common stock. The IPO was originally priced Wednesday night at $20.00 per share. Hilton had been taken over by Blackstone Group LP (BX) in 2007 and its stock was delisted from the New York Stock Exchange.
The company returns to the NYSE under its old symbol HLT. Blackstone, a private equity firm, bought the company in a leveraged buyout for $6.5 billion in equity and $20 billion of debt before the 2008 financial crisis.
McLean, Virginia based Hilton Worldwide Holdings Inc. was founded 94 years ago and is the worldâ s largest hotel chain. The hospitality company boasts ten world class brands operating over 4,000 managed, leased and owned hotels and timeshare properties. The company has more than 670,000 rooms in 90 countries across the globe and, until yesterday was the 38th largest private U.S. corporation. Yesterdayâ s IPO had the company issue a total of 117,640,624 shares of common stock at a price of $20.00 per share. Hilton Worldwide sold 64,102,564 shares, while a selling stockholder offered 53,538,060 shares granting underwriters the option to buy an additional 17,646,093 at the IPO price less the underwriter discount. Acting as underwriters for the issue were Deutsche Bank Securities, J.P. Morgan (JPM
), Goldman Sachs (GS
) , Morgan Stanley (MS
), Bank of America (BAC
) Merrill Lynch, and Wells Fargo Securities (WFC
). According to the companyâ s press release, Hilton Worldwide will use part of the estimated proceeds of $2.35 billion from the IPO to repay outstanding loan borrowings of $1.25 billion. The offering was oversubscribed by a factor of nine, and could prompt Hilton to sell additional shares to meet demand, raising the total amount of the offering to $2.7 billion. While other competitors have been selling their real estate, and focusing on improving management, Hilton intends to keep most of its real estate, according to CEO Christopher Nassetta. In an interview with Bloomberg Television yesterday, he said that, â
Published on Dec 13, 2013
By Jay Hawk