Madrone Capital Partners and Goldman Sachs Capital Partners Entities To Invest $1 Billion in Global Hyatt Corporation
Tom Pritzker, Chairman of Global Hyatt Corporation,
announced today that Madrone Capital Partners, a private investment firm affiliated with Rob Walton and his family, and entities affiliated with Goldman Sachs Capital Partners
have agreed to invest a total of $1 billion to acquire equity securities in Global Hyatt Corporation. This investment represents a minority stake in the company and will be used primarily to provide liquidity to the Pritzker family interests that currently own Global Hyatt. Global Hyatt Corporation will be expanding the size of its Board of
Directors to include the appointment of representatives from both investment groups.
Greg Penner, a General Partner of Madrone Capital Partners, and Byron Trott, a Vice Chairman of Investment Banking, Goldman, Sachs & Co., will be joining the Board.
[Note to editors: biographical information provided below]
“In the three years since Global Hyatt was formed in 2005, we have been building our company into a broad based, world class participant in the hospitality industry,” said Tom
Pritzker. “Consistent with previously announced plans, we are also in the process of restructuring our family’s holdings. As part of our strategic planning we considered
opening up our shareholder base to an investor or investors who shared our vision and could facilitate the implementation of the company’s strategy. As we considered the criteria we would use, Rob Walton’s family interests and Goldman Sachs emerged as possessing the key attributes we sought: global awareness and presence, world-class
reputation, long-term perspective and an ability to add value through ongoing engagement with the Board and management of the company.”
Pritzker continued, “The addition of these sophisticated investors with long-term horizons will allow us to further our restructuring efforts without affecting Global Hyatt’s
financial capacity to grow and execute on our business plan. With this transaction, we believe we have served the interests of both the company and its shareholders. The
addition of Greg and Byron to the Board provides us with individuals who bring relationships and know-how that fit squarely within our business model. While we have
previously spoken about making Global Hyatt ‘public ready’ in all aspects of our reporting, controls, management and growth profile, we have no specific plans to access
the public markets at this time.”
Specific details about the structure of the transaction are not being disclosed. Rob Walton observed, “Global Hyatt has all of the ingredients necessary for long-term
growth: a capable and dedicated group of associates, solid capital base, well-respected brands and a global footprint including a strong presence in the highest growth areas in
the world.” Greg Penner, of Madrone Capital Partners, added, “Global Hyatt Corporation is an enduring business franchise with strong growth prospects. Our investment in Hyatt
exemplifies our philosophy of investing with a long-term orientation and aligning with the very best people. The leadership team at Hyatt, led by Tom Pritzker and Mark
Hoplamazian, embodies the high level of quality and integrity that we look for in our partners. We are pleased to embark on this relationship with the Global Hyatt team.”
"Global Hyatt is a premier global business that represents the best in what we look for in our prospective investments - an industry leading brand with global reach, superior
growth prospects in its industry and a world class management team focused on building shareholder value," said Richard A. Friedman, Chairman of Goldman Sachs Capital
Partners. "Goldman Sachs has a long and successful history of partnering with families and management in closely-held enterprises to help achieve their strategic objectives.
We are thrilled to have the opportunity to work with Tom Pritzker, Mark Hoplamazian and the rest of the Hyatt team, and will commit the global resources of Goldman Sachs to
support Hyatt in realizing its extraordinary growth prospects."
Global Hyatt Corporation has announced a number of exciting changes in recent months, including a re-alignment of its organizational structure to be more customer-focused,
strengthening the company’s senior management team with the appointment of new global leaders of Real Estate and Development and Human Resources, entrance into the
select service segment with the launch of Hyatt Place™ and Hyatt Summerfield Suites™ and the introduction of a new full-service concept in casual luxury, Andaz™.
Global Hyatt has announced that it has more than 65 hotels in the full service pipeline opening over the next three years, including 16 in Greater China. Two Andaz brand
properties are slated for New York and one for London, with others under discussion elsewhere in the world including Beijing. The company also continues to build on its
reputation in North America with accelerated plans for both the Hyatt Summerfield Suites and Hyatt Place brands. Hyatt Summerfield Suites recently announced that it has
ten new build hotels across the United States which will join the 30 Hyatt Summerfield
Suites hotels that are and will be operating by year-end 2007. At the same time, Hyatt Place announced that, with the inclusion of 20 new build hotels, the total number of new
build Hyatt Place projects under development is 50 hotels and its rapidly growing portfolio should reach 120 hotels nationwide by year-end 2007.
“These two new strong investors bring their own worldwide networks of contacts and business partners, which are a perfect complement to our existing global relationships. As
Global Hyatt continues to take advantage of the growth of travel in new geographies while building on our strong brand reputation, we welcome the breadth of experience that
our new partners bring to the organization,” added Mark Hoplamazian, President and CEO of Global Hyatt Corporation. “We are always looking for new ways to deliver more
value to our associates, our guests and our owners, and other industries can provide us with best practices that are applicable to enhancing the Hyatt experience. Our new
investors know what it takes to build strong successful businesses, and they can help us with our commitment to reinforce Hyatt’s reputation as the best in class throughout the world.”
