Hilton talks $500 million eight-year notes to yield in 5 1/8% area; deal could upsize

By Paul A. Harris

Portland, Ore., April 10 – Hilton Worldwide Holdings, Inc. talked a $500 million offering of eight-year senior notes (Ba2/BB+) to yield in the 5 1/8% area, a trader said, adding that there was an expectation in the market that the deal could upsize.

Official talk came tight to early guidance in the 5¼% area.

The Rule 144A and Regulation S offering was expected to price Tuesday; however, no terms were available at press time.

BofA Merrill Lynch is the lead.

The notes come with three years of call protection.

The issuing entity is Hilton Domestic Operating Co. Inc., an indirect subsidiary of Hilton Worldwide Holdings.

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.

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