Tags: hilton | ipo | investors

Hilton IPO Off to Strong Start With Investors

Image: Hilton IPO Off to Strong Start With Investors

Thursday, 12 Dec 2013 04:17 PM

By Clyde Hughes

Hilton, the world's largest hotel chain, went public Wednesday with the biggest initial public offering (IPO) for a hotel chain in history at $20 per share and investors could not get enough.

Investors snatched up 117.6 million shares of Hilton Worldwide Holdings Inc. Wednesday, a windfall of $2.3 billion for its owners, the Blackstone Group LP. The shares opened Thursday on the New York Stock Exchange with a 7 percent bump, at $21.30 per share.

Urgent: Do You Approve Or Disapprove of President Obama's Job Performance? Vote Now in Urgent Poll

"For Blackstone, it doesn't make sense to keep something this valuable on the books," Jeffrey Sica of the New Jersey-based Sica Wealth Management LLC told Bloomberg News. "Hilton’s business has been doing well, so it makes very good sense for them to do it now."

Hilton Worldwide stated in a news release that it plans to use the proceeds to repay about $1.25 billion of term loan borrowings outstanding under its senior secured credit facilities.

Hilton owns 700,000 hotel rooms at properties around the world, including New York City's Waldorf Astoria and the Hilton Hawaiian Village in Waikiki.

The Wall Street Journal reported that Blackstone, a New York private-equity firm, bought Hilton Worldwide for $6.5 billion in equity and layered on about $20 billion in debt in 2007. Blackstone, though, had to write down the value of its initial investment by 70 percent when the global financial crisis hit the hotel industry in 2009.

Blackstone restructured its debt in 2010 and the hotel expanded its brand through franchising that helped increase revenue with minimal capital. The WSJ said Blackstone did not sell any of its shares in the IPO and retained a 76 percent stake in Hilton Worldwide, or $15 billion, according to Wednesday's IPO.

"Hilton has been focused on re-establishing its industry leader status," Lukas Hartwich, lodging analyst at Green Street Advisors Inc. in Newport Beach, wrote in a report, according to the Los Angeles Times. "Future growth has shifted to primarily non-U.S. markets."

Hilton owns 10 hotel brands including DoubleTree, Homewood Suites, and Hampton Inn. The brand dates back to 1919 when Conrad Hilton purchased his first hotel is Cisco, Texas.

Editor's Note: ObamaCare Is Here. Are You Prepared?

Related Stories:

© 2015 Newsmax. All rights reserved.

Around the Web
Join the Newsmax Community
Please review Community Guidelines before posting a comment.
>> Register to share your comments with the community.
>> Login if you are already a member.
blog comments powered by Disqus
 
Email:
Country
Zip Code:
Privacy: We never share your email.
 
Hot Topics
Follow Newsmax
Like us
on Facebook
Follow us
on Twitter
Add us
on Google Plus
You May Also Like

Kentucky Senator Brandon Smith Wants Out of DUI With Immunity Law

Friday, 23 Jan 2015 19:20 PM

Kentucky state Senator Brandon Smith, arrested earlier this month on a DUI charge, is making an effort to get the charge . . .

School Bus Pentagram? Woman Outraged Over Satanic Brake Light Symbol

Friday, 23 Jan 2015 18:53 PM

A Tennessee woman is outraged after spotting what she says is a satanic pentagram formed by the brake lights on a school . . .

Rapper Tiny Doo May Face Long Jail Sentence Over Lyrics

Friday, 23 Jan 2015 18:10 PM

San Diego rapper Tiny Doo is facing a possible 25-year prison sentence for his violent song lyrics under a little-known  . . .

Top Stories

Newsmax, Moneynews, Newsmax Health, and Independent. American. are registered trademarks of Newsmax Media, Inc. Newsmax TV, and Newsmax World are trademarks of Newsmax Media, Inc.

 
NEWSMAX.COM
America's News Page
©  Newsmax Media, Inc.
All Rights Reserved