RLPC: Hilton Worldwide preps $5.85B refinancing loan
NEW YORK, Sept 13
NEW YORK, Sept 13 (Reuters) - Hilton Worldwide Inc is launching a $5.85 billion credit at a bank meeting at 10 a.m. EST September 17 in New York City, sources told Thompson Reuters LPC. Proceeds will refinance existing debt in advance of Hilton's initial public offering.
Deutsche Bank is lead left on the loans, with Bank of America Merrill Lynch, JP Morgan, Morgan Stanley, and Goldman Sachs to the right. The new loan will consist of an $850 million, five-year term loan B-1 and a $5 billion, seven-year term loan B-2.
The TLB-2 will amortize at the standard 1 percent. The loans will carry 101 soft call protection for six months. The borrower on the credit is Hilton Worldwide Finance LLC, sources added.
Hilton expects to raise $1.25 billion from its initial public offering. Prior to the IPO, Hilton plans to enter into a refinancing credit consisting of the new term loans and a new senior secured revolving credit facility, according to a September 12 SEC filing.
New senior notes, a commercial mortgage-backed securities loan at Hilton's domestic subsidiaries, and a new bank loan backed by Hilton's Waldorf-Astoria New York property will also be part of the refinancing package.
Borrowing under Hilton's revolving non-recourse timeshare notes credit facility will also be used to repay certain debt, the filing said.
Deutsche Bank, Goldman Sachs, Bank of America Merrill Lynch, and Morgan Stanley are joint book-running managers for the IPO.
Hilton Worldwide serves 125 million guests annually at hotel brands including Waldorf Astoria, Hampton Inn, Conrad, Doubletree, and Embassy Suites.
In October 2007 Hilton was acquired by affiliates of The Blackstone Group. That transaction was financed with $20.6 billion of mortgage and mezzanine debt and approximately $5.7 billion of equity invested by the Blackstone Group.
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