Oct. 20, 2009--Hyatt Hotels Corp. announced Monday that the shares it expects to sell to the general public will be priced at $23 to $26. The announcement comes just days after the Pritzker family, which controls the chain, aired its infighting in documents filed with the Securities and Exchange Commission.

"Disputes among Pritzker family members ... may arise or continue in the future," Hyatt warned in a revised initial public offering document that has not yet received SEC approval. "If such disputes occur, they may result in significant distractions to our management, disrupt our business, have a negative effect on the trading price of our Class A common stock and/or generate negative publicity."

The filings also point to a disagreement over Penny Pritzker's role on the board as an "independent" director who in the original prospectus could veto the amount of stock family members could sell. Family members may now sell up to 25 percent of their Hyatt shares each year, up from 20 percent, although the prospectus warns that if family members choose to sell quickly, such sales could negatively affect the stock price. Penny Pritzker could not be reached for comment.

How will such disclosures affect the appetite for Hyatt Hotel stock?

"Somehow the market will bake that reality into the price," said Craig Aronoff, co-founder and principal of the Family Business Consulting Group, which works with family-owned companies confronted with generational transitions. "Some investors might be less prone to invest in that stock because of those particular circumstances. Others would say it's a powerful brand name and we would like to have some of the family involved in the enterprise."

Joe Astrachan, executive director of the Cox Family Enterprise Center at Kennesaw State University, said most investors are looking well beyond the present. He said that though a family's disputes may make for interesting reading, they probably will have little to no effect on investors.

"They're airing on the side of transparency, which is always good for an investment," he said.

Since Hyatt's founder, Jay Pritzker, died in 1999, and his son Thomas was named as his direct successor, the family's 11 heirs, their spouses and their children have been fighting over how the family's assets are divvied up. The family controls more than 100 businesses, and since 2005 has chosen to settle disputes through an arbitrator.

The infighting, in part, led to the decision to sell Hyatt stock.

"Investors would obviously be concerned if they thought the Pritzker family could dump a material amount of stock, since stock prices are based on supply and demand and significant stock dumping could drive down prices," said John Arabia, a senior lodging analyst at Green Street Advisors, an independent research, trading and consulting firm. "It doesn't appear to be a real material risk," Arabia said. "But it's something to watch for."

Thomas Pritzker said he couldn't comment, citing the quiet period before a company goes public.

A Hyatt spokeswoman also declined to comment. Other Pritzker family members declined or could not be reached to comment for this report.

Even a revised history of the company is contained in a recent filing. The original prospectus credited Jay Pritzker with building Hyatt. But a recent revision added that his brother Donald and the "Pritzker family business interests" played key roles in the company's growth.

The offering is structured so the Pritzker family would own 80 percent of Hyatt's Class B common stock, each share of which has 10 times the voting power of each Class A common share.

The company's initial public offering of 38 million Class A shares would raise between $874 million and $988 million.

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