Hilton Worldwide IPO raises £2.35b

12 December 2013 by
Hilton Worldwide IPO raises £2.35b

Hilton Worldwide raised $2.35b (£1.4b) from its IPO yesterday (Wednesday), putting its private equity owner on course to more than double its investment.

Owner Blackstone Group sold 117.6 million shares at $20 (£12.10) each. When it announced in September its intention to float on the stock market, the company said it aimed for $18 - $21.

The firm sold 5 million shares more than it had initially said it would, making it the second largest listing in the US this year.

The IPO returns the hotel chain to the public market for the first time in six years, after Blackstone took it private in 2007 when it acquired the company for $26.7b (£16.2b) in what was one of largest buy-outs before the global financial crisis.

Around $6.8b (£4.15b) was then invested in the global hotel group and Hilton then ceased trading on the New York Stock Exchange.

Blackstone refinanced about $13b of Hilton's debt before launching the IPO, according to Reuters, which said the company also plans to use the proceeds from the offering to repay $1.25b in debt.

The 76.2% stake its funds will hold following the IPO would be worth about $15b, meaning it is on course to make more than 2.3 times its money and that that Hilton ranks as one of the most successful private equity deals of its size.

Over the past six years, the Hilton Worldwide has added more than 1,000 hotels to create a 4,000-strong portfolio across more than 90 countries. In the UK it operates nearly 120 properties under the Waldorf Astoria, Hilton Hotels and Resorts, Doubletree by Hilton, Hampton by Hilton and Hilton Garden Inn brands.

The headquarters, headed by chief executive Christopher Nassetta, are based in McLean, Virginia, near Washington DC, while the UK arm of the business is led by Simon Vincent, who is Hilton Worldwide's area president of Europe, Middle East and Africa.

Biggest hotel-IPO set for Hilton Worldwide >>

Hilton Worldwide confirms return to stock market >>

TagsFinance and Hotels
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