(Adds details, background, shares)
April 8 The initial public offering of La Quinta
Holdings, owned by the Blackstone Group, was
priced at $17 per share on Tuesday, valuing the hotel chain at
about $2.1 billion
La Quinta's IPO raised $650 million, after its offering of
38.25 million shares was priced below an expected range of $18
to $21 a share.
Irving, Texas-based La Quinta is selling all the shares in
Shares of the company, which are expected to start trading
on Wednesday, will be listed on the New York Stock Exchange
under the symbol.
La Quinta in a statement said it expects net proceeds of
about $618 million from the offering after deducting
underwriting discounts and commissions.
JP Morgan and Morgan Stanley are the lead underwriters for
the offering. Other notable underwriters include BofA Merrill
Lynch, Citigroup, Credit Suisse, Deutsche Bank Securities and
La Quinta is the third hotel chain to be taken public by
Blackstone, the world's largest publicly listed alternative
asset manager, in the past six months. Blackstone has been
aggressively selling or taking public its real estate assets as
the U.S. hotel industry has been recovering.
Blackstone, whose stock closed down 2.4 percent at $30.42 on
the New York Stock Exchange on Tuesday, was initially exploring
a sale of La Quinta, which it took private in a $3.4 billion
deal in 2006.
Blackstone took Hilton Worldwide Holdings Inc public
in the biggest-ever hotel IPO in December. It also bought
shopping center company Brixmor Property Group Inc and
hotel chain Extended Stay America Inc to the market
With more than 830 hotels, La Quinta is one of the largest
owners and operators of mid-priced hotels in the United States.
Blackstone, which currently holds about 96 percent stake in
La Quinta, will see its stake drop to about 64 percent after the
IPO if the underwriters fully exercise their option to buy
Net proceeds from the offering would be used to repay debt
and for general corporate purposes, La Quinta said in its
The company, which first filed confidentially with the SEC
for an IPO in December, reported net income of $44.5 million on
total revenue of $909 million, on a pro forma basis, in 2013.
(Reporting by Shubhankar Chakravorty and Avik Das in Bangalore)