Investors piled into HCA Holdings Inc's $3.79 billion initial public offering on Wednesday, shrugging off the hospital operator's high debt levels as the market for newly traded shares heats up.

The company sold more shares than planned, at the high end of the expected price range, marking the largest U.S. private-equity backed IPO ever.

HCA faces real risks in the future, including its high debt levels and partial reliance on government-funded medical insurers that are facing political pressure to cut costs.

But with interest rates low, investors are eager to take more risk to earn higher returns. HCA's success is expected to encourage a slew of similar IPOs of private equity investments made at the height of the credit bubble in 2005 to 2007.

If you can price a $3 billion deal for a hospital operator that has a few warts and do so successfully, there are a lot of deals that could be done right now, said Bill Buhr, IPO strategist at Morningstar.

Nashville, Tennessee-based HCA sold 126.2 million shares for $30 each, exceeding an expected 124 million shares at $27 to $30 each. Shareholders sold another 38.5 million shares, or 6 percent more than originally planned.

HCA was taken private during the buyout frenzy of 2006 in a $21 billion deal, excluding debt, that involved Bain, KKR , Bank of America Corp , Citigroup Inc and HCA's founder, healthcare mogul Dr. Thomas F. Frist Jr.

After the IPO, the leveraged buyout investors and the Frist family are expected to more than triple their 2006 investment.

In 2010, the stakeholders received more than $4 billion in dividends paid through HCA's borrowings.

HCA's shares are expected to begin trading on the New York Stock Exchange on Thursday under the symbol HCA .

Far surpassing its peers by market value, a newly public HCA could generate more investor interest in the sector, and even turn the company into a major acquirer.

Some have speculated HCA could get involved in Community Health Systems' $3.3 billion takeover bid for a smaller hospital operator, Tenet Healthcare Corp .

It would be surprising if (HCA) did it this soon after an IPO, but obviously it's possible, said Nathan Snyder, a portfolio manager at Snow Capital Management, which owns shares of LifePoint Hospitals , Health Management Associates and Community Health.

RISKS AND IPO MOMENTUM

Analysts warned that in clamoring for HCA shares, investors are overlooking big longer-term risks, including the uncertain impact of the U.S. healthcare overhaul.

The new law is expected to increase the number of insured patients seeking medical help, but will also phase in Medicare payment cuts to hospitals and make it harder to negotiate reimbursement rates. Almost 41 percent of HCA's revenue in 2010 came from federal insurance programs, it said.

Moreover, HCA's debt averaged nearly $27 billion in 2010. The company's liabilities exceed its assets on the books by more than $12 billion.

At the same time, HCA is profitable and has stable cash flows, making debt less of a concern for potential investors, Snyder said.

HCA's offering also comes on the heels of several successful private-equity backed IPOs this year.

In the past two months, consumer measurement company Nielsen Holdings raised $1.6 billion, Florida-based BankUnited raised $783 million, and pipeline company Kinder Morgan Inc raised $2.9 billion.

Toys R Us has filed with U.S. regulators to raise up to $800 million, and Freescale Semiconductor has filed to raise up to $1.15 billion. Although neither company has set terms or picked a debut date, a blockbuster IPO by HCA could help them -- and other buyout-backed companies mulling IPOs.

The window has not been more open than now in the past four to five years, said Morningstar's Buhr.

Underwriters on HCA's IPO were led by Bank of America Merrill Lynch, Citi and JPMorgan Chase .

(Additional reporting by Bill Berkrot, Stephen Lacey, Ben Berkowitz and Susan Kelly in Chicago; Editing by Bernard Orr, Gary Hill and Richard Chang)