Hilton Worldwide (formerly, Hilton Hotels Corporation) is a global hospitality company. It is owned by the Blackstone Group, a private equity firm. As of November 2010 Hilton brands encompass over 3,600 hotels with 600,000 rooms in 82 countries.[1] Hilton is ranked as the 36th largest private company in the United States by Forbes.[2]
The company owns, manages, or franchises a portfolio of brands, including Hilton Hotels & Resorts, Conrad Hotels, Doubletree, Embassy Suites Hotels, Hampton Inn, Hampton Inn & Suites, Hilton Garden Inn, Hilton Grand Vacations Company, Homewood Suites by Hilton, Home2 Suites by Hilton and The Waldorf-Astoria Collection.
It was founded by Conrad Hilton in Cisco, Texas and was headquartered in Beverly Hills, California from 1969 until 2009. The company moved to Tysons Corner, unincorporated Fairfax County, Virginia, near McLean in August 2009.
Hilton Hotels Corporation is a leading hospitality company that owns, manages, and franchises over 2,000 hotels across the country. The company's international arm, Conrad Hotels, has locations in Australia, England, Ireland, Egypt, Belgium, Turkey, Hong Kong, and Singapore. Though publicly traded, the chain was for most of its history led by members of the Hilton family from 1919, when founder Conrad Hilton bought his first hotel. By the late 1940s, Hilton owned a worldwide chain of premium hotels. In the 1960s, Hilton sold its international operations and concentrated on management contracts and franchising. The company created innovative joint-venture arrangements that became standard industry practice. It then entered what would become a prime source of revenue for the company: casino-hotels. Hilton expanded into gaming in 1971; by 1989, gaming provided 44 percent of the company's income. In 1996, Barron Hilton relinquished day-to-day management of the chain to Stephen F. Bollenbach. Asserting that "Big companies do big things," Bollenbach revitalized the company with bold actions. He spun off the company's gaming operations as Park Place Entertainment Corporation in 1998. One year later he orchestrated the $3.7 billion acquisition of Promus Hotel Corporation, which added the Doubletree, Embassy Suites, Hampton Inn, Homewood Suites, and Harrison Conference Centers brand names to its line-up.
Conrad Hilton founded the original company in 1919 with one hotel in Cisco, Texas. The Hotel's name is Mobley Hotel.
The Hotels Statler Company was acquired in 1954 for $111,000,000 in what was then the world's most expensive real estate transaction.[citation needed]
The company separated its international operations into a separate traded company on December 1, 1964, known as Hilton International Co.. In 1967 Trans World Corp., the holding company for Trans World Airlines, acquired the separated company. In 1986 it was sold to UAL Corp., the holding company for United Airlines, who became Allegis Corp. in an attempt to re-incarnate itself as a full service travel company encompassing Westin Hotels and Hertz rental cars in addition to Hilton International and United Airlines. In 1987 after a corporate putsch, the renamed UAL Corp. sold Hilton International to Ladbroke Group plc, a British leisure and gambling company, which in May 1999 adopted the name Hilton Group plc.[citation needed]
The former Hilton Hotels Corporation headquarters in Beverly Hills
As a result, there were two separate, fully independent companies operating hotels under the Hilton name. Those Hilton Hotels outside the US were, until recently, styled as Hilton International hotels. In addition, for many years hotels run by the Hilton Group in the US were called Vista International Hotels, while hotels operated by the American arm of Hilton outside the US were named Conrad Hotels. The Vista chain has been phased out, while Conrad is now restyled as one of the luxury brands of Hilton (along with The Waldorf-Astoria Collection) and operates hotels within the US, as well as abroad. To minimize consumer confusion, the American and British Hilton companies, from the 1990s onwards, had a joint marketing agreement under which they shared the same logos, promoted each others' brands and maintained joint reservation systems.
In 1971, Hilton acquired International Leisure Company, including the Las Vegas Hilton and Flamingo Hilton.
In 1998, Hilton spun off its gaming operations into a separate, publicly held company called Caesars Entertainment (formerly Park Place Entertainment).
In 1999, Hilton acquired Promus Hotel Corporation, which included the Doubletree, Red Lion, Embassy Suites, Hampton Inn, & Homewood Suites brands.
In 2001, Hilton agreed to sell Red Lion to WestCoast Hospitality.
HHC was granted the naming rights to the George R. Brown Convention Center in late 2003. The Hilton Americas in Downtown Houston, Texas, is connected to the convention center.
On December 29, 2005, Hilton Hotels Corporation agreed to re-acquire the Hilton International chain from its British owner, Hilton Group plc, for GBP 3.3 billion (or $5.71 billion). As well as bringing the two Hilton companies back together as a single entity, this deal also included Hilton plc properties operating as Conrad Hotels, Scandic Hotels and LivingWell Health Clubs. On February 23, 2006, the deal closed, making Hilton Hotels the world's fifth largest hotel operator in number of rooms. Hilton Group PLC (headquartered in the UK) then renamed itself Ladbrokes plc.
On March 1, 2007, Scandic Hotels was sold to EQT V Group.
On July 3, 2007, Hilton Hotels Corp. agreed to an all-cash buyout from The Blackstone Group LP in a $26 billion (including debt) deal that would make Blackstone the world's largest hotel owner. The deal was the culmination of a year of on and off discussions with Blackstone.
The private equity group said it would combine cash from its real estate and corporate private equity funds to buy all outstanding Hilton shares for $47.50 each, a 32 percent premium over the July 3 closing stock price.
In October 2007, Christopher J. Nassetta was appointed President and Chief Executive Officer of Hilton.
In February 2009, Hilton Hotels Corp., announced that its headquarters were moving from its three buildings on Civic Center Drive in Beverly Hills to the lower cost Fairfax County, Virginia, located between Washington, D.C. and Dulles International Airport. Just across the Potomac River is Montgomery County, Maryland, home to a number of Hilton's competitors including Marriott International, Ritz-Carlton, Host Hotels & Resorts, and Choice Hotels, and was also considered for the relocation along with Washington. The move also put management closer to its overseas operations in Europe.
While Blackstone saw an opportunity to streamline the company and push Hilton's expansion overseas when Blackstone pursued Hilton in 2006 and 2007, the buyout saddled the company with $20 billion of debt just as the economy was turning down. The debt had very liberal terms, so there was no danger of default, but when travel slowed, the company suffered. In April 2010, Hilton and Blackstone restructured the debt. Blackstone invested a further $800 million of equity and the debt was reduced to $16 billion.
After three decades of leadership, Barron Hilton relinquished the chief executive office of the corporation in 1996. While his final years at the helm were criticized as indecisive and overly conservative, the fact remained that its revenues increased from less than $1 billion in 1989 to $1.6 billion in 1995. Net income increased at an average annual rate of 19.6 percent, from $84.3 million in 1991 to $172.8 million in 1995.
In 1996 53-year-old Stephen F. Bollenbach became the first non-Hilton to guide the company. He came to the job with incontrovertible credentials, having engineered both a debt restructuring for the Trump empire and Walt Disney's $19 billion acquisition of Capital Cities/ABC. A spate of high-profile deals quickly ensued. Within five months, the new CEO had merged Hilton with Bally Entertainment Corporation via a stock swap valued at $2 billion. In one move, the deal created the world's largest gaming concern and made casino gambling Hilton's largest business. However, in the interest of equilibrium, Bollenbach also executed several key moves to expand the hotel chain. First, he repurchased the Prudential Insurance Company's stake in six Hiltons for $433 million. He also pledged to increase via franchising Hilton's budget Garden Inns chain by 50,000 rooms over the remaining years of the decade.
Before 1996 had ended, Bollenbach had also pulled off a reunification of the global Hilton presence. By the mid-1990s, ownership of Hilton International (and the overseas rights to the Hilton name) had passed to London's Ladbroke Group plc. Hilton purchased a 3 percent stake in Ladbroke and in return the British concern agreed to invest in future Hilton enterprises. The two companies planned to create cooperative marketing programs (including honoring each other's frequent stay plans) and develop new hotels together.
On January 27, 1997, Hilton bid $55 per share for New York-based ITT Corporation, aiming primarily to acquire its ITT Sheraton subsidiary's 415 hotels and 14 casinos. The company's hostile takeover attempt eventually failed when Starwood Lodging Trust outbid Hilton in a very public and heated battle. Bollenbach was undeterred by the failure and forged ahead with his strategy to take Hilton into the next millennium. Believing that Hilton's hotel and casino operations could achieve a higher stock value if they became separate entities, Bollenbach set plans in motion to spin off the firm's gaming arm. Shareholders agreed with the plan and in 1998, Park Place Entertainment Corporation--now known as Caesar's Entertainment Inc.--began operating as a public company. Bollenbach was named chairman of the new firm.
Hilton Hotels' next big move came one year later when it made a $3.7 billion play for Promus Hotel Corporation. A September 1999 Wall Street Journal article summed up the company's reasoning for the deal claiming, "The transaction is designed to launch Hilton into a competitive triumvirate of top hotel companies with Marriott International Inc. and Starwood Hotels & Resorts Worldwide Inc." Indeed, as a result of the deal Hilton increased its portfolio to over 1,800 hotels located in all 50 states and added Doubletree, Embassy Suites Hotels, Hampton Inn, Hampton Inn & Suites, Homewood Suites, and Harrison Conference Centers to its hotel arsenal.
With the Promus deal under its belt, Hilton stood on solid ground as it entered the new millennium. During 2000, the company formed a joint venture with Hilton Group plc to strengthen and expand its Conrad Hotels unit overseas. The company signed an agreement the following year with Hoteles Camino Real S.A. de C.V. The partnership added the Camino Real hotels and resorts in Mexico and Texas to Hilton's brand portfolio. Bollenbach hinted at the company's future acquisition strategy in a 2001 Hotel and Motel Management article stating, "A lot of changes have occurred at Hilton in the last five years, going from a company that was about half gambling company and a half hotel company to today being focused on the hotel business. We have a company that is forever one of the major competitors in the hotel business." He went on to claim, "Hilton is what you think of as a strategically complete company. It means we don't need to add anything to what we have in our collection of businesses."
While Hilton digested its Promus purchase, it faced challenges due to a weak economy as well as a slowdown in travel as a result of the September 11, 2001, terrorist attacks. In fact, Hilton's stock fell to its lowest point in ten years during 2001. Revenues dropped in both 2001 and 2002, however net income increased by 19 percent in 2002. While net income fell in 2003, sales increased by nearly 51 percent over the previous year--a sure sign that the company had a solid business strategy in place. With Bollenbach at the helm, Hilton appeared to be well positioned for future growth in the years to come.
Principal Subsidiaries: Conrad International (Belgium) Corporation; Conrad International Corporation; Doubletree Corporation; Doubletree Hotels Corporation; Grand Vacations Realty LLC; Grand Vacations Title LLC; Hilton Chicago Corporation; Hilton Grand Vacations Club LLC; Hilton Grand Vacations Company LLC; Hilton Holdings Inc.; Hilton Hotels Partners I LLC; Hilton Hotels Partners II LLC; Hilton Hotels U.S.A. Inc.; Promus BPC Corporation; Promus Hotel Corporation; Promus Hotel Services Inc.; Promus Hotels Florida Inc.; Promus Hotels Minneapolis Inc.; Promus Hotels Inc.
Principal Competitors: Hyatt Corporation; Marriott International Inc.; Starwood Hotels & Resorts Worldwide Inc.
Statistics:
Public Company
Incorporated:1946
Employees:74,000
Sales:$3.85 billion (2003)
Stock Exchanges:New York
Ticker Symbol:HLT
NAIC: 721110 Hotels (Except Casino Hotels) and Motels
Key Dates:
1919: Conrad Hilton buys his first hotel.
1925: The first hotel carrying the Hilton name is constructed in Dallas.
1946: Hilton Hotels Corporation is formed.
1947: Becomes the first hotel company to have its stock listed on the New York Stock Exchange.
1949: Hilton buys the lease on New York's Waldorf-Astoria.
1953: The first European Hilton opens in Madrid.
1964: Hilton International is spun off as a public company.
1970: The company buys two casino hotels in Las Vegas.
1982: Subsidiary Conrad International Hotels is formed to oversee international growth.
1996: Stephen F. Bollenbach becomes the first non-Hilton to guide the company; Hilton merges with Bally Entertainment Corporation.
1998: Hilton spins off its gaming operations as Park Place Entertainment Corporation.
1999: Hilton acquires Promus Hotel Corporation for $3.7 billion.
Address:
9336 Civic Center Drive
Beverly Hills, California 90210
U.S.A.
The company owns, manages, or franchises a portfolio of brands, including Hilton Hotels & Resorts, Conrad Hotels, Doubletree, Embassy Suites Hotels, Hampton Inn, Hampton Inn & Suites, Hilton Garden Inn, Hilton Grand Vacations Company, Homewood Suites by Hilton, Home2 Suites by Hilton and The Waldorf-Astoria Collection.
It was founded by Conrad Hilton in Cisco, Texas and was headquartered in Beverly Hills, California from 1969 until 2009. The company moved to Tysons Corner, unincorporated Fairfax County, Virginia, near McLean in August 2009.
Hilton Hotels Corporation is a leading hospitality company that owns, manages, and franchises over 2,000 hotels across the country. The company's international arm, Conrad Hotels, has locations in Australia, England, Ireland, Egypt, Belgium, Turkey, Hong Kong, and Singapore. Though publicly traded, the chain was for most of its history led by members of the Hilton family from 1919, when founder Conrad Hilton bought his first hotel. By the late 1940s, Hilton owned a worldwide chain of premium hotels. In the 1960s, Hilton sold its international operations and concentrated on management contracts and franchising. The company created innovative joint-venture arrangements that became standard industry practice. It then entered what would become a prime source of revenue for the company: casino-hotels. Hilton expanded into gaming in 1971; by 1989, gaming provided 44 percent of the company's income. In 1996, Barron Hilton relinquished day-to-day management of the chain to Stephen F. Bollenbach. Asserting that "Big companies do big things," Bollenbach revitalized the company with bold actions. He spun off the company's gaming operations as Park Place Entertainment Corporation in 1998. One year later he orchestrated the $3.7 billion acquisition of Promus Hotel Corporation, which added the Doubletree, Embassy Suites, Hampton Inn, Homewood Suites, and Harrison Conference Centers brand names to its line-up.
Conrad Hilton founded the original company in 1919 with one hotel in Cisco, Texas. The Hotel's name is Mobley Hotel.
The Hotels Statler Company was acquired in 1954 for $111,000,000 in what was then the world's most expensive real estate transaction.[citation needed]
The company separated its international operations into a separate traded company on December 1, 1964, known as Hilton International Co.. In 1967 Trans World Corp., the holding company for Trans World Airlines, acquired the separated company. In 1986 it was sold to UAL Corp., the holding company for United Airlines, who became Allegis Corp. in an attempt to re-incarnate itself as a full service travel company encompassing Westin Hotels and Hertz rental cars in addition to Hilton International and United Airlines. In 1987 after a corporate putsch, the renamed UAL Corp. sold Hilton International to Ladbroke Group plc, a British leisure and gambling company, which in May 1999 adopted the name Hilton Group plc.[citation needed]
The former Hilton Hotels Corporation headquarters in Beverly Hills
As a result, there were two separate, fully independent companies operating hotels under the Hilton name. Those Hilton Hotels outside the US were, until recently, styled as Hilton International hotels. In addition, for many years hotels run by the Hilton Group in the US were called Vista International Hotels, while hotels operated by the American arm of Hilton outside the US were named Conrad Hotels. The Vista chain has been phased out, while Conrad is now restyled as one of the luxury brands of Hilton (along with The Waldorf-Astoria Collection) and operates hotels within the US, as well as abroad. To minimize consumer confusion, the American and British Hilton companies, from the 1990s onwards, had a joint marketing agreement under which they shared the same logos, promoted each others' brands and maintained joint reservation systems.
In 1971, Hilton acquired International Leisure Company, including the Las Vegas Hilton and Flamingo Hilton.
In 1998, Hilton spun off its gaming operations into a separate, publicly held company called Caesars Entertainment (formerly Park Place Entertainment).
In 1999, Hilton acquired Promus Hotel Corporation, which included the Doubletree, Red Lion, Embassy Suites, Hampton Inn, & Homewood Suites brands.
In 2001, Hilton agreed to sell Red Lion to WestCoast Hospitality.
HHC was granted the naming rights to the George R. Brown Convention Center in late 2003. The Hilton Americas in Downtown Houston, Texas, is connected to the convention center.
On December 29, 2005, Hilton Hotels Corporation agreed to re-acquire the Hilton International chain from its British owner, Hilton Group plc, for GBP 3.3 billion (or $5.71 billion). As well as bringing the two Hilton companies back together as a single entity, this deal also included Hilton plc properties operating as Conrad Hotels, Scandic Hotels and LivingWell Health Clubs. On February 23, 2006, the deal closed, making Hilton Hotels the world's fifth largest hotel operator in number of rooms. Hilton Group PLC (headquartered in the UK) then renamed itself Ladbrokes plc.
On March 1, 2007, Scandic Hotels was sold to EQT V Group.
On July 3, 2007, Hilton Hotels Corp. agreed to an all-cash buyout from The Blackstone Group LP in a $26 billion (including debt) deal that would make Blackstone the world's largest hotel owner. The deal was the culmination of a year of on and off discussions with Blackstone.
The private equity group said it would combine cash from its real estate and corporate private equity funds to buy all outstanding Hilton shares for $47.50 each, a 32 percent premium over the July 3 closing stock price.
In October 2007, Christopher J. Nassetta was appointed President and Chief Executive Officer of Hilton.
In February 2009, Hilton Hotels Corp., announced that its headquarters were moving from its three buildings on Civic Center Drive in Beverly Hills to the lower cost Fairfax County, Virginia, located between Washington, D.C. and Dulles International Airport. Just across the Potomac River is Montgomery County, Maryland, home to a number of Hilton's competitors including Marriott International, Ritz-Carlton, Host Hotels & Resorts, and Choice Hotels, and was also considered for the relocation along with Washington. The move also put management closer to its overseas operations in Europe.
While Blackstone saw an opportunity to streamline the company and push Hilton's expansion overseas when Blackstone pursued Hilton in 2006 and 2007, the buyout saddled the company with $20 billion of debt just as the economy was turning down. The debt had very liberal terms, so there was no danger of default, but when travel slowed, the company suffered. In April 2010, Hilton and Blackstone restructured the debt. Blackstone invested a further $800 million of equity and the debt was reduced to $16 billion.
After three decades of leadership, Barron Hilton relinquished the chief executive office of the corporation in 1996. While his final years at the helm were criticized as indecisive and overly conservative, the fact remained that its revenues increased from less than $1 billion in 1989 to $1.6 billion in 1995. Net income increased at an average annual rate of 19.6 percent, from $84.3 million in 1991 to $172.8 million in 1995.
In 1996 53-year-old Stephen F. Bollenbach became the first non-Hilton to guide the company. He came to the job with incontrovertible credentials, having engineered both a debt restructuring for the Trump empire and Walt Disney's $19 billion acquisition of Capital Cities/ABC. A spate of high-profile deals quickly ensued. Within five months, the new CEO had merged Hilton with Bally Entertainment Corporation via a stock swap valued at $2 billion. In one move, the deal created the world's largest gaming concern and made casino gambling Hilton's largest business. However, in the interest of equilibrium, Bollenbach also executed several key moves to expand the hotel chain. First, he repurchased the Prudential Insurance Company's stake in six Hiltons for $433 million. He also pledged to increase via franchising Hilton's budget Garden Inns chain by 50,000 rooms over the remaining years of the decade.
Before 1996 had ended, Bollenbach had also pulled off a reunification of the global Hilton presence. By the mid-1990s, ownership of Hilton International (and the overseas rights to the Hilton name) had passed to London's Ladbroke Group plc. Hilton purchased a 3 percent stake in Ladbroke and in return the British concern agreed to invest in future Hilton enterprises. The two companies planned to create cooperative marketing programs (including honoring each other's frequent stay plans) and develop new hotels together.
On January 27, 1997, Hilton bid $55 per share for New York-based ITT Corporation, aiming primarily to acquire its ITT Sheraton subsidiary's 415 hotels and 14 casinos. The company's hostile takeover attempt eventually failed when Starwood Lodging Trust outbid Hilton in a very public and heated battle. Bollenbach was undeterred by the failure and forged ahead with his strategy to take Hilton into the next millennium. Believing that Hilton's hotel and casino operations could achieve a higher stock value if they became separate entities, Bollenbach set plans in motion to spin off the firm's gaming arm. Shareholders agreed with the plan and in 1998, Park Place Entertainment Corporation--now known as Caesar's Entertainment Inc.--began operating as a public company. Bollenbach was named chairman of the new firm.
Hilton Hotels' next big move came one year later when it made a $3.7 billion play for Promus Hotel Corporation. A September 1999 Wall Street Journal article summed up the company's reasoning for the deal claiming, "The transaction is designed to launch Hilton into a competitive triumvirate of top hotel companies with Marriott International Inc. and Starwood Hotels & Resorts Worldwide Inc." Indeed, as a result of the deal Hilton increased its portfolio to over 1,800 hotels located in all 50 states and added Doubletree, Embassy Suites Hotels, Hampton Inn, Hampton Inn & Suites, Homewood Suites, and Harrison Conference Centers to its hotel arsenal.
With the Promus deal under its belt, Hilton stood on solid ground as it entered the new millennium. During 2000, the company formed a joint venture with Hilton Group plc to strengthen and expand its Conrad Hotels unit overseas. The company signed an agreement the following year with Hoteles Camino Real S.A. de C.V. The partnership added the Camino Real hotels and resorts in Mexico and Texas to Hilton's brand portfolio. Bollenbach hinted at the company's future acquisition strategy in a 2001 Hotel and Motel Management article stating, "A lot of changes have occurred at Hilton in the last five years, going from a company that was about half gambling company and a half hotel company to today being focused on the hotel business. We have a company that is forever one of the major competitors in the hotel business." He went on to claim, "Hilton is what you think of as a strategically complete company. It means we don't need to add anything to what we have in our collection of businesses."
While Hilton digested its Promus purchase, it faced challenges due to a weak economy as well as a slowdown in travel as a result of the September 11, 2001, terrorist attacks. In fact, Hilton's stock fell to its lowest point in ten years during 2001. Revenues dropped in both 2001 and 2002, however net income increased by 19 percent in 2002. While net income fell in 2003, sales increased by nearly 51 percent over the previous year--a sure sign that the company had a solid business strategy in place. With Bollenbach at the helm, Hilton appeared to be well positioned for future growth in the years to come.
Principal Subsidiaries: Conrad International (Belgium) Corporation; Conrad International Corporation; Doubletree Corporation; Doubletree Hotels Corporation; Grand Vacations Realty LLC; Grand Vacations Title LLC; Hilton Chicago Corporation; Hilton Grand Vacations Club LLC; Hilton Grand Vacations Company LLC; Hilton Holdings Inc.; Hilton Hotels Partners I LLC; Hilton Hotels Partners II LLC; Hilton Hotels U.S.A. Inc.; Promus BPC Corporation; Promus Hotel Corporation; Promus Hotel Services Inc.; Promus Hotels Florida Inc.; Promus Hotels Minneapolis Inc.; Promus Hotels Inc.
Principal Competitors: Hyatt Corporation; Marriott International Inc.; Starwood Hotels & Resorts Worldwide Inc.
Statistics:
Public Company
Incorporated:1946
Employees:74,000
Sales:$3.85 billion (2003)
Stock Exchanges:New York
Ticker Symbol:HLT
NAIC: 721110 Hotels (Except Casino Hotels) and Motels
Key Dates:
1919: Conrad Hilton buys his first hotel.
1925: The first hotel carrying the Hilton name is constructed in Dallas.
1946: Hilton Hotels Corporation is formed.
1947: Becomes the first hotel company to have its stock listed on the New York Stock Exchange.
1949: Hilton buys the lease on New York's Waldorf-Astoria.
1953: The first European Hilton opens in Madrid.
1964: Hilton International is spun off as a public company.
1970: The company buys two casino hotels in Las Vegas.
1982: Subsidiary Conrad International Hotels is formed to oversee international growth.
1996: Stephen F. Bollenbach becomes the first non-Hilton to guide the company; Hilton merges with Bally Entertainment Corporation.
1998: Hilton spins off its gaming operations as Park Place Entertainment Corporation.
1999: Hilton acquires Promus Hotel Corporation for $3.7 billion.
Address:
9336 Civic Center Drive
Beverly Hills, California 90210
U.S.A.
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