A $26 billion leveraged buyout. 

In the fall of 2007, Blackstone bought Hilton in a leveraged deal for $26 billion at the height of the real estate bubble. The deal totaled $26 billion, and Blackstone used $6 billion in funds and $20 billion in loans to take it down with a leveraged buyout. After the completion of the deal, Hilton has 10 hotel brands, 2800 hotels around the world, and nearly 500000 rooms are owned by Blackstone. 

However, before the two sides could celebrate, the financial crisis sweeping the world hit. 
At that time, when the global economy was depressed and the hotel industry collapsed, Blackstone had to write down the value of Hilton Hotels Group. it was estimated that the market value of Hilton Hotel had been wiped out by $6 billion during the financial crisis. this is equivalent to the total amount of money that Blackstone initially invested. As a result, this sky-high investment was once reduced to a "joke". 

To make matters worse, the financial crisis almost froze credit markets and Blackstone's heavy debt through leveraged buyouts could not be restructured. Wall Street investment banks such as Goldman Sachs, Bank of America, Deutsche Bank, Merrill Lynch and Lehman Brothers, which provided loans for the deal, were unable to securitize assets in the market in exchange for liquidity. 

The deal embarrassed Blackstone. Although Blackstone has repeatedly stressed that 70 per cent of the loss on the investment is only on paper, no one ignored these futile explanations during the financial crisis, and all people saw was falling numbers and fears about the future. 

Textbook style to turn the tide: the turnaround of Blackstone. 

At a time when everyone was disappointed, Blackstone quietly began an unprecedented "great rescue". 

At the beginning, Blackstone made great efforts to clean up the Hilton management team, inviting Chris Nasetta (Chris Nassetta) to serve as the CEO of Hilton Hotels Group. With years of management experience in the hotel industry, Nasetta embarked on a series of innovative plans as soon as he took office, including the relocation of headquarters from Beverly Hills, California to Virginia and the replacement of senior managements. slash operating costs. 

In particular, Blackstone boldly promoted Hilton's franchise strategy. In fact, Hilton Group began to try the hotel franchise model as early as 20 years ago, but it has not been implemented on a large scale. After Blackstone took over, it thought it was an excellent model to expand the hotel business with as little money as possible. Through this reform, Hilton has made Hilton-branded hotels blossom with little or no investment. 

Thanks to Blackstone's efforts, Hilton's business and financial situation continued to improve, not only survived the financial crisis, but also moved towards IPO. 

In December 2013, Hilton successfully listed on the New York Stock Exchange at $20 a share, raising $2.3 billion, making it the largest IPO in the history of the hotel industry. 

To "dodge a bullet" this time can not be separated from Blackstone's superb financial skills. To buy Hilton, Blackstone has $20 billion in debt. After the financial crisis, the Federal Reserve implemented several rounds of quantitative easing monetary policy. with the gradual recovery of liquidity in the market and the revival of credit markets, Blackstone made full use of the wisdom of its financial operations. in the next few years, more than $4 billion of debt was resolved, including the use of $1 billion for bond buybacks and restructuring, and converting some of the debt into preferred shares. Many of its practices are still praised by the industry.