Hyatt Value IPO Journey Book
Hyatt Corporation Value IPO Journey Book
Hyatt Corporation is a global company widely known for its brand of hotels, resorts, residential, and vocation ownership properties. Established by Jay Pritzker in 1957, Hyatt's worldwide portfolio consists of 453 Hyatt-branded properties scattered in the North America, Europe, Middle East, Africa, Latin America, Asia Pacific and Southwest Asia. Hyatt manages franchises and develops residential and brand hotels, and the company full service hotels is operated under five brands which are Hyatt, Park Hyatt, Hyatt Regency, Andaz, and Grand Hyatt.(Corporate Information 2011). Since the beginning of the year 2000, Hyatt has been performing excellently, and the company cash flow has doubled during the period. However, in 2009, Hyatt's revenue fell by 19% and the company's cash flow fell by 50%, which made the company to post the loss of approximately $36 millions in the first quarter of 2009. In addition, the company's consolidated revenues decreased compared to the 2008 fiscal year. The problem that faced Hyatt in 2009 was due to the current global financial crisis that affected major corporations in advanced countries. With the financial problems facing Hyatt in 2009 that served as threat to the company growth, Hyatt Corporation made the decision to go public by initiating the Initial Public Offering (IPO).
The objective of this essay is to investigate Hyatt strategy behind its recent IPO decision.
Hyatt strategy behind its recent IPO decision
"An Initial Public Offering (IPO) is a legal process in which a company registers its securities with the Securities and Exchange Commission (SEC) for sale to the general investing public." (Evans, 2011 P. 2). Many Companies view the process of going public as the route to the financial rewards and success. Following the financial difficulties that Hyatt faced in 2009, the company made the decision to go public by initiating the IPO. There are several strategies behind Hyatt's IPO decision.
First, Hyatt decision to go public is a broader access to raise capital. In the United States, going public is a single biggest source of capital for the corporate organizations. Following the Hyatt revenue decline in 2009, Hyatt Corporation makes a strategic decision to initiate the IPO to raise capital from the public. Typically, the equity capital markets are...
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