Hilton to offer record USD3.5 billion CMBS

November 14
5:54 PM 2013

Investors were expecting global hospitality company Hilton Worldwide to start marketing a USD3.5 billion collateralized mortgage-backed security (CMBS) through five investment banks on Thursday. 

Reuters, citing buyside sources, said that this is the largest CMBS offering since the financial crisis in 2008. 

The CMBS is a key part of Hilton Worlwide's USD13.425 billion debt-financing package backed by private equity firm The Blackstone Group LP. According to Reuters, Hilton is preparing for an initial public offering in early December. 

The hospitality company was bought by The Blackstone Group in October 2007 for USD26.3 billion. 

The report said that investment bank JP Morgan will be the structuring lead underwriter of the CMBS offering, whilst Deutsche Bank will be the co-lead manager. Investment firms Bank of America, Goldman Sachs and Morgan Stanley will be serving as co-managers and joint bookrunners. 

The CMBS, which is expected to close by the end of next week, is the last component of Hilton's debt package. It is anticipated to hit a post-crisis volume record of about USD80 billion this year, Reuters said.  

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