CHICAGO - Hyatt Hotels Corporation (NYSE: NYSE:H), a prominent hospitality company, disclosed the pricing of its public offering of senior notes totaling $800 million. The notes are divided into two series: $450 million due in 2029 with a 5.25% interest rate, and $350 million due in 2034 with a 5.50% interest rate.
The closing of the offering is anticipated on June 17, 2024, subject to the satisfaction of customary conditions. Hyatt aims to allocate the net proceeds to retire its 1.800% notes due on October 1, 2024, and cover general corporate purposes, along with the offering-related fees and expenses.
BofA Securities, Deutsche Bank (ETR:DBKGn) Securities, J.P. Morgan, and Scotiabank (TSX:BNS) are serving as the underwriters' representatives and joint book-running managers for the offering. The offering is executed under a shelf registration statement on Form S-3 filed with the Securities and Exchange Commission (SEC) on August 30, 2023, which became effective upon filing.
Hyatt's portfolio as of March 31, 2024, encompasses over 1,300 properties in 78 countries across six continents, featuring a range of brands catering to various segments of the hospitality market. The company also operates the World of Hyatt loyalty program and other subsidiary services.
The press release includes forward-looking statements regarding the offering and its intended use of proceeds. These statements are subject to risks and uncertainties that could cause actual results to differ materially from those projected.
This article is based on a press release statement and does not constitute an offer to sell or a solicitation of an offer to buy securities. The offering of securities will not take place in any jurisdiction where such an offer, solicitation, or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction.
InvestingPro Insights
As Hyatt Hotels Corporation (NYSE: H) navigates its latest offering of senior notes, the company's financial health and market performance become focal points for potential investors. With a robust gross profit margin of 67.12% over the last twelve months as of Q1 2024, Hyatt showcases its ability to efficiently manage its cost of sales relative to revenue, a critical factor in the hospitality industry where margins can often be squeezed by operational costs.
Hyatt's management has demonstrated confidence in the company's future by aggressively buying back shares, which is often seen as a positive signal about the company's valuation and future prospects. This aligns with the PRONEWS24 InvestingPro Tip highlighting the management's bullish stance. For investors weighing the risk and benefits of the senior notes offering, this could be an encouraging sign of the company's commitment to shareholder value.
Despite some analysts revising their earnings expectations downwards for the upcoming period, the company still trades with low price volatility, providing a relatively stable investment environment. This is complemented by Hyatt's significant price increase over the last six months, reflecting a 25.12% total return, which underscores the potential for capital appreciation in addition to the fixed income from the notes.
For those interested in a deeper dive into the financial metrics and future outlook of Hyatt Hotels Corporation, InvestingPro provides additional insights and tips. Currently, there are 11 more InvestingPro Tips available, which can be accessed at: https://www.investing.com/pro/H. Use the coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription, unlocking a comprehensive analysis that could further inform investment decisions.
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