Published on 4/16/2020 in the Prospect News High Yield Daily.
New Issue: Hilton prices upsized $1 billion senior notes in two tranches
By Paul A. Harris
Portland, Ore., April 16 – Hilton Hotels & Resorts doubled the size of its sale of senior notes (Ba2/BB) to $1 billion from $500 million with the addition of a $500 million tranche of eight-year notes, according to market sources.
The sale, which came in a Thursday drive-by, included $500 million of five-year notes, which priced at par to yield 5 3/8%. The yield printed at the tight end of yield talk in the 5½% area.
Hilton also sold $500 million of eight-year notes at par to yield 5¾%.
BofA Securities Inc. was the left bookrunner. Joint bookrunners were Deutsche Bank Securities Inc., J.P. Morgan Securities LLC, Wells Fargo Securities LLC, Barclays, Citigroup Global Markets Inc., Goldman Sachs & Co. LLC and Morgan Stanley & Co. LLC.
The notes were sold via Hilton Domestic Operating Co. Inc.
The McLean, Va.-based hospitality company plans to use the proceeds for general corporate purposes.
| Issuer: | Hilton Domestic Operating Co. Inc.
|
| Amount: | $1 billion, increased from $500 million
|
| Securities: | Senior notes
|
| Left bookrunner: | BofA Securities Inc.
|
| Joint bookrunners: | Deutsche Bank Securities Inc., J.P. Morgan Securities LLC, Wells Fargo Securities LLC, Barclays, Citigroup Global Markets Inc., Goldman Sachs & Co. LLC and Morgan Stanley & Co. LLC
|
| Co-managers: | Capital One Securities Inc., Credit Agricole CIB, HSBC Securities (USA) Inc., MUFG, NatWest, PNC Capital Markets LLC, Standard Chartered Bank, SunTrust Robinson Humphrey Inc. and U.S. Bancorp Investments Inc.
|
| Trade date: | April 16
|
| Settlement date: | April 21
|
| Ratings: | Moody's: Ba2
|
| S&P: BB
|
| Distribution: | Rule 144A and Regulation S for life
|
| Marketing: | Drive-by
|
|
|
| Five-year notes
|
| Amount: | $500 million
|
| Maturity: | May 1, 2025
|
| Coupon: | 5 3/8%
|
| Price: | Par
|
| Yield: | 5 3/8%
|
| Spread: | 503 bps
|
| Call protection: | Two years
|
| Price talk: | 5½% area
|
|
|
| Eight-year notes
|
| Amount: | $500 million
|
| Maturity: | May 1, 2028
|
| Coupon: | 5¾%
|
| Price: | Par
|
| Yield: | 5¾%
|
| Spread: | 524 bps
|
| Call protection: | Three years
|
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