Hilton Worldwide Holdings Inc. (Hilton), HNA Group (HNA) and Blackstone announced today that HNA will purchase an approximate 25 percent equity interest in Hilton for a total consideration of $6.5Bn ($26.25 per share).
HNA acquires its stake from Blackstone, establishing a long-term strategic investment in Hilton and Hilton’s planned spin-offs of Park Hotels & Resorts (Park) and Hilton Grand Vacations (HGV).
After the transaction Blackstone’s interest in Hilton to approximately 21 percent. The purchase is expected to close in the first quarter of 2017.
Following Hilton’s previously announced spin-offs of Park and HGV, which are expected to occur on or about the end of the year, HNA will own approximately 25 percent of all three companies.
Since its establishment in 1993, HNA Group has evolved from a regional airline based on Hainan Island into a global company with over $90 billion of assets, $30 billion in annual revenues and an international workforce of nearly 200,000 employees, primarily across North America, Europe and Asia. HNA’s tourism business is a fast-growing, vertically-integrated global player with market-leading positions in aviation, hotels and travel services.
HNA operates and invests in nearly 2,000 hotels with over 300,000 rooms across major markets, and has 1,250 aircraft carrying over 90 million passengers to 260 cities worldwide.
HNA accepted some restrictions regarding political, purchase and sale rights
As part of the transaction, HNA has entered into a stockholders agreement with Hilton, and into similar agreements with Park Hotels & Resorts and Hilton Grand Vacations, effective upon closing. The agreement allows HNA to appoint two directors (one HNA member and one independent member) to Hilton’s Board of Directors, bringing the total to ten members.
Pursuant to the agreement, HNA has agreed to certain restrictions on its ability to sell any of its interest in Hilton for a two-year period, and to limitations on HNA’s ability to acquire more than 25% of Hilton’s outstanding shares, without Hilton’s consent. Furthermore, under the agreement, HNA will vote its shares in excess of 15% proportionally with other stockholders, subject to certain exceptions. Blackstone will continue to have two seats on Hilton’s Board, including Jon Gray who will remain chairman.
A Chinese partner for growth
“We are pleased to welcome HNA Group as a long-term investor and strategic partner,” said Christopher J. Nassetta, President and CEO of Hilton. “HNA Group has a broad portfolio of successful travel and hospitality businesses and a proven track record of creating value in this industry. We believe this mutually beneficial relationship will open new opportunities for our brands and guests around the world, particularly in light of HNA’s strong position in the fast-growing Chinese travel and tourism market, the largest outbound travel and tourism market in the world.”
“Hilton is an iconic global hospitality company with an unmatched portfolio of high-quality brands and a reputation for operational excellence,” said Adam Tan, Vice Chairman and CEO of HNA Group. “This investment is consistent with our strategy to enhance our global tourism business, and we look forward to working together on new initiatives that leverage our respective strengths, expertise and tourism platforms to provide travelers more choice, value and world-class services.”
Established in the USA 97 years ago, Hilton Worldwide is a leading global hospitality company, comprising more than 4,700 managed, franchised, owned and leased hotels and timeshare properties with over 775,000 rooms in 104 countries and territories.
The company’s portfolio of 13 world-class global brands includes Hilton Hotels & Resorts, Waldorf Astoria Hotels & Resorts, Conrad Hotels & Resorts, Canopy by Hilton, Curio – A Collection by Hilton, DoubleTree by Hilton, Embassy Suites by Hilton, Hilton Garden Inn, Hampton by Hilton, Tru by Hilton, Homewood Suites by Hilton, Home2 Suites by Hilton and Hilton Grand Vacations
Image over the headline.- Respectively © Hilton Worldwide, © HNA y © Blackstone
