Extended Stay America Inc. (STAY) raised USD565 million in an initial public offering. The IPO almost tripled the returns for the company's private equity and hedge fund owners, Bloomberg said.

Extended Stay is the largest owner of mid-price long-stay hotels in the US. American businessman and former Starbucks Corp Chief Executive Officer Jim Donald currently leads the hotel brand.

The company sold 28.25 million shares priced at USD20 per share, according to Bloomberg data. Extended Stay said that net proceeds from the offering would be used for debt payment.

Extended Stay is equally held by private equity firms Blackstone Group LP, Centerbridge Partners LP and Paulson & Co. None of the entities sold their shares.

Extended Stay sold about 14.1% of itself in the listing, giving it a market capitalisation of about USD4 billion. The USD565 million raised in IPO excluded 4.24 million shares in overallotment, which could further raise IPO proceeds to USD649.75 million.