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Public Affairs coverage from our award-winning staff |
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Hyatt Shares Trade High
Produced by Susie An on Thursday, November 05, 2009
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The Chicago-based Hyatt Hotel corporation is selling 38 million shares in its initial public offering, today. The sale could be spurred by family infighting.
Initial public offerings or IPOs are usually set up for companies to raise additional capital for things like expansion projects or debt payment. But Morningstar analyst Michelle Chang says Hyatt Hotel's financial balance sheet seems to be in good shape. Members of the wealthy Pritzker family are the largest holders of the company's stock with an 85 percent stake. Chang says Hyatt's IPO is unique because all proceeds will go to the Pritzkers and not the corporation.
CHANG: There's been a lot of news surrounding Pritzker for disagreements within the family. So this might be a way for some of them to sell out of their stake. It seems to be something related to the family.
Chang says if all the shares sell out, the family would still hold 78 percent of the decision-making power. The hotel priced its common stock at $25 a share. A Hyatt spokeswoman declined to comment.
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