Published on 4/10/2018 in the Prospect News High Yield Daily.
New Issue: Hilton prices massively upsized $1.5 billion eight-year notes at par to yield 5 1/8%
By Paul A. Harris
Portland, Ore., April 10 – Hilton Worldwide Holdings, Inc. priced a massively upsized $1.5 billion issue of eight-year senior notes (Ba2/BB+) at par to yield 5 1/8% on Tuesday, according to market sources.
The issue size was increased from $500 million.
The yield printed in the middle of yield talk in the 5 1/8% area and tight to early guidance in the 5¼% area.
BofA Merrill Lynch was the lead left bookrunner. Joint bookrunners were Deutsche Bank Securities Inc., Goldman Sachs & Co., Morgan Stanley & Co. LLC, Barclays, J.P. Morgan Securities LLC and Wells Fargo Securities LLC.
The McLean, Va.-based hospitality company plans to use the proceeds, together with available cash and a draw on its revolver, to repurchase 10 million shares of Hilton common stock beneficially owned by HNA Tourism Group Co., Ltd., with any remaining proceeds to be used for general corporate purposes.
| Issuer: | Hilton Domestic Operating Co. Inc.
|
| Amount: | $1.5 billion, increased from $500 million
|
| Maturity: | May 1, 2026
|
| Securities: | Senior notes
|
| Left bookrunner: | BofA Merrill Lynch
|
| Joint bookrunners: | Deutsche Bank Securities Inc., Goldman Sachs & Co., Morgan Stanley & Co. LLC, Barclays, J.P. Morgan Securities LLC, Wells Fargo Securities LLC
|
| Co-managers: | Citigroup Global Markets LLC, SunTrust Robinson Humphrey Inc., Credit Agricole CIB, Credit Suisse Securities (USA) LLC, HSBC Securities (USA) Inc., MUFG, RGS, Sumitomo
|
| Coupon: | 5 1/8%
|
| Price: | Par
|
| Yield: | 5 1/8%
|
| Spread: | 235 bps
|
| Call protection: | Three years
|
| Trade date: | April 10
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| Settlement date: | April 13
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| Ratings: | Moody's: Ba2
|
| S&P: BB+
|
| Distribution: | Rule 144A with registration rights
|
| Price talk: | 5¼% area
|
| Marketing: | Quick to market
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