THE US new issues market showed no signs of slowing down yesterday after two American hospitality giants with substantial UK operations priced their forthcoming market floats.
Hotel operator Hilton Worldwide and catering company Aramark, both backed by private equity firms, announced plans to raise up to $2.37bn (£1.44bn) and $833.8m respectively in initial public offerings (IPO) to list on the New York Stock Exchange.
Hilton, which is owned by Blackstone, said it hoped to sell 112.8m shares at between $18 and $21 per share, valuing the company at $20.7bn.
Aramark, which is owned by Warburg Pincus, Goldman Sachs’ private equity arm and JP Morgan, said it anticipated selling 28m shares at between $20 and $23 a share. At the upper end of the range, the float would value the business at around $5.3bn. The company has around 12,500 employees in the UK and provides catering services to organisations like the armed forces as well as business organisations.
Deutsche Bank, Goldman Sachs, Bank of America Merrill Lynch and Morgan Stanley are lead underwriters on the Hilton IPO. Goldman Sachs, JP Morgan, Credit Suisse and Morgan Stanley are lead underwriters on the Aramark offering.
The red hot IPO market in New York is in contrast to London, which has seen the sheen come off the buoyant new issues market over the past month following on from several roaring successes in the third quarter.
The Hilton IPO is set to become the second biggest float of the year behind Plains GP Holdings and will dwarf Twitter’s high profile float, which raised $1.82bn. The hotel chain, which was founded in 1919 by Conrad Hilton, has around 4,000 hotels.
Aramark, run by former Pepsi boss Eric Foss, is controlled by Warburg, Goldman’s GS Capital Partners and JP Morgan Partners and was taken private by the trio in 2006.