Hilton Worldwide Holdings Inc.’s shares rose in their trading debut, after the hotelier and some insiders sold more stock than initially planned in a $2.35 billion initial public offering.
The shares were up 7.7% at $21.54 in midmorning trading Thursday, after opening at $21.30. Late Wednesday, Hilton and some existing holders agreed to sell 117.6 million shares for $20 each. Underwriters may sell more stock, increasing the deal size.
The deal marks the world’s largest hotel IPO by proceeds, topping Hyatt Hotels Corp.'s(H) $1.1 billion debut in November 2009, according to Dealogic.
Hilton’s debut caps a multi-year turnaround and marks a big paper profit for the company’s majority owner, private-equity firm Blackstone Group LP(BX). Blackstone acquired the company for about $25 billion in debt and equity in 2007, the height of the last decade’s real-estate and buyout boom. The buyout firm isn’t selling any stock in the offering.
Recently, the hotel operator has benefited from rebounding room rates in its industry and a strategy of growing revenue and expanding its brand through franchising agreements, a less-costly approach than owning property outright.
Top Performing Stocks To Watch Right Now
Hilton enjoyed healthy demand for its IPO during a marketing road show, pricing the deal a day ahead of schedule as bankers’ order books filled up quickly. As the deal was being priced Wednesday, Hilton opted to sell about 4%
more stock than initially planned.
The shares are listed on the New York Stock Exchange under the symbol “HLT.” Deutsche Bank AG(DBK.XE) led the offering with Goldman Sachs Group Inc., Bank of American Merrill Lynch and Morgan Stanley.
Elsewhere in the IPO market, food services company Aramark Holdings Corp. opened at $20.25 Thursday, up 1.3% from its $20 offer price. That was the low end of the range the company had expected, according to a regulatory filing. In midmorning trading, the shares were up 7.1%.
The company and existing holders agreed to sell 36.3 million shares, raising $725 million.
The Philadelphia company’s IPO is its third, following a series of buyouts in the last four decades, the latest by a group of private-equity firms including Warburg Pincus LLC and Thomas H. Lee Partners in 2007.
Rising stock-market valuations have fueled a spate of IPOs this year, many of them by private equity-backed companies looking to harvest past years’ investments.
Three other companies were set to begin trading Thursday morning following IPOs: TetraLogic Pharmaceuticals Corp., CatchMark Timber Trust Inc. and Kindred Biosciences Inc.
Scorpio Bulkers Inc., a Monaco-based shipping company with shares listed on a Norwegian over-the-counter market, agreed to sell U.S. stock alongside an exchange offer for the existing shares-a transaction akin to an IPO.
No comments:
Post a Comment