Adia buys key stake in Hyatt
The Abu Dhabi Investment Authority (Adia) has purchased a 2.9 per cent stake in Hyatt Hotels Corp in a move economists see as a bet on the recovery of the leisure industry and even the global economy in the near term.
The Abu Dhabi Investment Authority (Adia) has purchased a 2.9 per cent stake in Hyatt Hotels Corp in a move economists see as a bet on the recovery of the leisure industry and even the global economy in the near term.
According to filings made public by the US Securities and Exchange Commission (SEC), Adia purchased 4.8 million Hyatt common shares on November 4, or the day the hotel chain went public with 38 million shares at $25 (Dh92) per share. At that price, Adia's investment totals $118.9 million.
The company's stock closed at $29.5 on Monday, an 18 per cent increase since November 4.
A spokesman for Adia confirmed the fund is not looking to gain a controlling stake in Hyatt consistent with its long-standing investment strategy, but declined to comment further. About 60 per cent of Adia's unclassified wealth is invested in index funds.
"This is a bet on global economic recovery in 2010 and 2011," said Tudor Allin-Khan, Chief Economist for HC Securities, the Cairo-based investment bank managing $1 billion in assets. "The key issue for a sovereign wealth fund is to look for long-term value opportunities. Buying into the hotel and leisure industry at this stage in the economic cycle represents value."
