Hilton Returns to Public Trading with $2.3B IPO

MCLEAN, VA-Hilton Worldwide returned to trading on the New York Stock Exchange Thursday morning under the HLT ticker, six years after being taken private by the Blackstone Group and the morning after its IPO set a new record for the lodging sector. The offering of 117.6 million shares at $20 each raised $2.34 billion. Assuming that the underwriters exercise their overallotment options, it will rank as 2013's second-largest IPO after energy logistics company Plains GP Holdings' $2.82-billion offering in October.

The second lodging IPO this year from Blackstone, the public offering for Hilton was more than twice as large as the previous record-holder in the sector, Hyatt Hotels Corp.'s $1-billion launch in 2009. Based on the IPO, HLT has a stock-market value of just under $20 billion, according to the Financial Times. HLT said Wednesday it intended to use the net proceeds from the offering and available cash to repay approximately $1.25 billion of term loan borrowings outstanding under its senior secured credit facilities.

In an SEC filing last week, HLT noted that under CEO Christopher Nassetta, hired after Blackstone took the company private in 2007, it has “transformed” its business, “creating a globally aligned organization and establishing a performance-driven culture.” As part of the transformation under Blackstone ownership, the company has focused on both top- and bottom-line operating performance, “strengthening and expanding our brands and commercial services platform, and enhancing our growth rate, particularly in markets outside the US where our brands historically had been underrepresented.”