Hyatt Hotels to go public with $1.5 billion IPO

Hyatt Hotels Corporation, one of the world's leading chain of luxury hotels and resorts owned by Chicago's wealthy Pritzker family is planning to public with an $1.5 billion offering-making it the third largest IPO in the US this year.

The Chicago-based Hyatt, which operates 413 hotels and resorts in 45 countries, made the filing with the US Securities and Exchange Commission yesterday to raise up to $1.15 billion through the offering and use the proceeds for acquisitions and investment in new properties as well as other complimentary businesses.

However, in the filing, Hyatt has not given a date for the IPO nor has it given the price range of the shares or how many shares of Class A common stock would be offered, saying that these issues have still to be worked out.

For the first half of 2009, Hyatt said that it suffered a loss of $36 million compared to a $173 million profit for the same period last year. Revenue fell by 18.5 per cent, to $1.64 billion.

Last month, Hyatt changed the five-year $1 billion credit line it has with Wachovia Bank and said that $370 million is due in June 2010, while the remaining available credit will be due in June 2012.

The hotel industry has faced a fall in demand and sinking profits as businesses and holidaymakers cut back on travel amid the recession. The US hotel industry revenue per available room dropped 18.7 per cent to $53.87 per cent for the first half of 2009 in year-over-year measurements, according to Smith Travel Research (STR) data.