HOWZAT

That deal, which brought together the two Hiltons under one company for the first time since 1964, has transformed HHC’s expansion potential by allowing it to develop lower-tier brands such as Hampton Inn, Hilton Garden Inn and DoubleTree outside America.

It has 2,800 hotels and 485,000 rooms in 76 countries and territories.

Like many rivals, it has sold most of its property to focus on managing and franchising, but it owns about 50 hotels, including the Waldorf-Astoria in New York.

In April it announced a sale of ten European hotel properties to Morgan Stanley Real Estate Fund for $770 million and completed the outright disposal of Scandic Hotels, the Nordic operator, to EQT, a Stockholm-based private equity firm, for $1.1 billion.

Analysts say that, in private equity ownership, HHC could play a leading role in the consolidation of the international hotel sector.

In the past it has held abortive talks with rivals such as InterContinental and Hyatt.

A sale to private equity would bring a windfall for the family of Conrad Hilton, HHC’s founder and great-grandfather of the socialite Paris Hilton, who was recently released from prison after being convicted of violating her probation in a drink-driving case.

Hilton bought his first hotel in 1919, but it was another six years before the first hotel to sport the Hilton name opened, in Dallas, Texas.

From these beginnings Hilton Hotels grew into America’s first coast-to-coast hotel chain, and in 1946 Hilton Hotels Corporation was set up.

He went onto acquire landmark hotels, including the Waldorf-Astoria, now being developed as a luxury brand, and the Palmer House in Chicago.

Hilton eventually handed the reins to his son Barron, although when he died in 1979 he left most of his estate to his philanthropic organisation, the Conrad N. Hilton Foundation.

The Hilton family retains a stake of 5.3 per cent in the company.

Stephen Bollenbach, HHC's co-chairman and chief executive, who is scheduled to retire at the end of the year, defended the decision to recommend Blackstone's bid.

He said: "Our priority has always been to maximise shareholder value. This transaction provides compelling value for our shareholders with a significant premium."

Blackstone said that the funding for its bid would come from Bear Stearns, Bank of America, Deutsche Bank, Morgan Stanley and Goldman Sachs

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