Date
8 December 2016
HNA will pay US$26.25 a share in cash for the stake, a 15 percent premium to Hilton’s closing price on Friday. Photo: Bloomberg
HNA will pay US$26.25 a share in cash for the stake, a 15 percent premium to Hilton’s closing price on Friday. Photo: Bloomberg

China’s HNA Group to buy 25% stake in Hilton

Chinese conglomerate HNA Group plans to buy a 25 percent stake in Hilton Worldwide Holdings Inc. from Blackstone Group LP for US$6.5 billion.

The deal will reduce Blackstone’s interest in Hilton to approximately 21 percent, the Wall Street Journal reports..

HNA will pay US$26.25 a share in cash for the stake, a 15 percent premium to Hilton’s closing price of US$22.91 on Friday.

The move comes as Hilton is expected to later this year split into three distinct entities, the result of a plan to spin off a chunk of its hotels into a real-estate investment trust and to separate its timeshare business.

The HNA-Blackstone transaction is expected to close in the first quarter of 2017 and HNA will own approximately 25 percent of all three companies.

The agreement allows HNA to appoint two directors, one HNA member and one independent member, to Hilton’s Board of Directors, bringing the total to 10 members.

Blackstone will keep two seats on Hilton’s board, including chairman Jon Gray.

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