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UPDATE 1-Hilton to raise up to $2.37 bln in IPO

Monday, 2 Dec 2013 | 7:32 AM ET

Dec 2 (Reuters) - Hotel operator Hilton Worldwide Inc, controlled by private equity firm Blackstone Group LP, said its initial public offering would raise up to $2.37 billion, valuing the company at about $20.7 billion.

Hilton said it expected to price the offering of 112.8 million shares at between $18 and $21 per share, according to a filing with the U.S. Securities and Exchange Commission on Monday. ()

Hilton is selling 64.1 million shares in the offering, while the selling shareholder will offer 48.7 million.

The company, which did not say when it would launch the IPO, could raise $2.72 billion if underwriters exercise their rights to buy another 16.9 million shares.

Blackstone, which is not directly selling any of its shares in the offering, will hold 76.2 percent of Hilton after the IPO.

A source told Reuters last month that Hilton would increase the size of the IPO to about $2.25 billion.

Blackstone took Hilton private in 2007 in a $26.7 billion deal that was one of the largest leveraged buyouts before the 2008 global financial crisis.

Founded in 1919 by Conrad Hilton, the hotel operator's brands include such high-end names as Conrad and Waldorf Astoria.

Hilton has 4,041 hotels, or 665,667 rooms under its umbrella, located in 90 countries. The company itself owns or leases 157 hotels, including the Waldorf Astoria in New York and the Hilton Hawaiian Village.

Blackstone's plans for an IPO of Hilton come as private equity firms have been trying to sell or list assets to take advantage of a surging IPO market, as a market rally and low interest rates have encouraged investors to buy stocks.

Blackstone has also sought to unload its real estate assets. It is looking to take public hotel chain La Quinta, sources told Reuters last week.

Its other hotel chains such as Extended Stay America Inc and Brixmor Property Group Inc have also gone public this year.

Hilton will list under the symbol "HLT" on the New York Stock Exchange.

The lead underwriters on the offering are Deutsche Bank, Goldman Sachs Group Inc, Bank of America Corp and Morgan Stanley. The company said on Monday that J.P. Morgan, Wells Fargo Securities and 18 others would also underwrite the IPO.