Wednesday 21 March 2018

Blackstone to cut Hilton holding to less than half

Blackstone head Steven Schwarzman
Blackstone head Steven Schwarzman

Hui Yong-Yu

Blackstone is selling 90 million shares of Hilton Worldwide Holdings, reducing its stake in the world's biggest hotel operator to below the 50pc threshold.

Underwriters have the option to sell an additional 13.5 million shares, McLean, Virginia-based Hilton said in a statement.

If they're sold, Blackstone's Hilton stake would be reduced to 44.7pc from 55.2pc, the lodging company said in a regulatory filing.

Without the additional sale, the interest will be 46pc.

Blackstone rebranded the former Burlington Hotel in Dublin 4 to Hilton's Doubletree brand after the private equity firm bought the hotel in 2012.

Blackstone has been one of the biggest buyers of commercial real estate in Ireland since the crash.

Blackstone began paring its stake in Hilton last year after taking it public at $20 a share in December 2013 in a record initial public offering by a hotel company.

The 2007 acquisition of Hilton was written down by about 70pc during the financial crisis. Blackstone put in more cash and restructured the debt in 2010, and has since more than tripled its equity in the deal to make it the most profitable private equity investment on record.

The stock sale will yield about $2.7bn without the additional shares sold, based on Hilton's closing price on Friday. Hilton said it isn't offering any stock in the sale and won't receive any proceeds. Deutsche Bank, Bank of America Merrill Lynch and Citigroup are managing the offering. (Bloomberg)

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