Hilton Preps For $500 Million Notes Sale

BEVERLY HILLS, CA— Hilton Hotels Corp. is reportedly planning to sell $500 million of convertible notes in a private transaction to repay some outstanding debt. It was noted the convertible senior notes— due 2023— will be convertible into shares of Hilton’s common stock at a conversion price of $22.50 per share (under certain circumstances) and will bear an annual interest rate of 3.375%. As such, it was pointed out shares of the hotel chain closed on Tuesday at $13. According to previous reports, Hilton said it expects to use the net proceeds from the offering to redeem all of its outstanding 5% convertible subordinated notes due 2006 (callable at par on or after May 15, 2003) and to repay debt under its existing revolving credit facility. SOURCE: Reuters