Tags: Blackstone | LaQuinta | Stock | InitialOffering

Blackstone's La Quinta Rises After Pricing Initial Offering Low

Wednesday, 09 April 2014 02:02 PM

La Quinta's stock is up slightly in its return as a publicly traded company.

The Irving, Texas-based hotel chain was publicly traded for more than 30 years, before being acquired by Blackstone, the private equity firm, in 2006. Blackstone paid $2.3 billion in cash and also assumed La Quinta's debt, giving the deal a value of about $3.4 billion.

The initial public offering raised about $651 million and valued La Quinta at about $2.1 billion. Shares priced at $17, lower than the company had predicted, suggesting lukewarm demand from investors. The stock, now on the New York Stock Exchange Wednesday under the "LQ" ticker symbol, added 11 cents to $17.11 in late morning trading Wednesday after declining earlier.

La Quinta began in 1968 in San Antonio. The company runs select-service hotels, which typically have fewer amenities than full-service hotels. It had 834 hotels at the end of 2013.

La Quinta Holdings Inc.'s IPO priced at $17 per share Tuesday night. The projected price range was $18 to $21 per share. About 38.3 million shares were sold, nearly 1 million more than initially expected. The banks managing the deal may buy another 5.7 million shares, which would add to the deal's proceeds. La Quinta plans to use its proceeds to repay debt.

The other company that debuted Wednesday, iKang Healthcare Group Inc., rose 16 percent on the Nasdaq to $16.29 under the "KANG" symbol.

IKang's IPO raised nearly $153 million. The Chinese health care provider priced 10.9 million American depositary shares at $14 each, the top of the expected range.

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La Quinta Holdings Inc., the mid- priced hotel chain backed by Blackstone Group LP, climbed in its trading debut after the company raised a lower than expected $650 million in an initial public offering.
Wednesday, 09 April 2014 02:02 PM
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