Hilton to Consider Alternatives to Sale

Hilton Hotels Corp. said Tuesday that it will consider restructuring alternatives other than the much anticipated sale of the company, sending its stock sharply lower on Wall Street.

Hilton’s stock closed down $8.75 at $65.50 a share in New York Stock Exchange trading. It had traded as high as $115.50 a share after the company put itself on the block last August.

After trading closed, William Lebo, the company’s general counsel, said Hilton had received a takeover proposal, but he declined to reveal details.

Shares of the lodging and casino company have spiraled downward in recent weeks as prospects have faded that it would be sold at a premium.

Analysts had estimated that Hilton could fetch as much as $130 a share. The company has about 48 million shares outstanding.

In its earlier announcement Tuesday, Hilton said its board next week “will consider a number of alternatives for the company, including proposals to acquire the company, as well as restructuring strategies which would not involve a sale of the company.

“There can be no assurance that the company will elect to pursue any of those alternatives,” it added.

Hilton issued its statement in response to inquiries by the New York Stock Exchange. The company’s stock had fallen sharply before the announcement, and trading was halted briefly because of an imbalance of orders.

“My interpretation is that there’s a big difference between what may be coming in on the bid side and what Barron (company Chairman Barron Hilton) thinks is the proper ask side,” said Marvin Roffman, analyst at Janney Montgomery Scott Inc.

Last month, the Wall Street Journal reported that Chicago-based JMB Realty Corp. was offering about $90 a share.

But on Tuesday traders said a rumor that JMB had dropped out of the bidding was a factor driving Hilton’s stock down.

Bert Glazov, executive vice president for JMB, declined comment. JMB has never confirmed that it was a bidder for Hilton.

Alternatives to a sale include declaration of a special cash dividend or other measures.