There's family business and then there's family business.
The answer lies in the internal politics of divvying up the family fortune, the Chicago Tribune reports.
Preliminary offering documents filed late Wednesday with the Securities and Exchange Commission suggest there is little other reason to sell shares in the Chicago family's crown jewel during the worst economy since the Great Depression.
For the Pritzkers many big decisions these days are driven by an agreement made after a family rift to divide their empire among 11 adult cousins by 2011.
The Hyatt balance sheet remains strong, despite a slumping hotel business, so now would not seem to be the optimum time to sell. With that in mind, the investment community is unhappy about it.
Investment bankers have been drooling over this IPO for decades, Business Week reports.
Hyatt is a formidable company. Last year the business earned $168 million on sales of $3.8 billion. It produced cash flow of $687 million. Today, 413 hotels around the world fly the Hyatt flag. The company owns about a quarter of those outright, including such landmark properties as the Park Hyatt in Chicago, the Grand Hyatt in New York, and the 1,200-room Hyatt Regency in Atlanta.
The family has squabbled, however, with the arrival of a fourth generation of heirs. In 2002, two of the younger heirs sued older family members for a larger share of the family fortune. That suit was settled in 2005. The feud led to a plan to split up the estimated $15 billion empire into 13 pieces, one for each cousin or sibling in the current generation.
The feud left the family shaken, but investors stirred, Forbes notes.
Hotel stocks are floundering, trading at levels unseen since 2002. The timing is bad for the Pritzkers, but good for investors.
The way the IPO is structured now, the Pritzkers would still maintain a controlling interest in Hyatt.
"This concentrated control will limit your ability to influence corporate matters, and the interests of [the] Pritzker family," the prospectus says, "may not coincide with our interests or your interests."
Still, the Tribune says that "For outside investors, buying Hyatt now would likely be a bargain."