Corinthia Finance announced this week the issue of a e20 million 10-year bond bearing an interest rate of 6.25 per cent per annum, and with an over-allotment option of an additional e5 million. The bonds will be redeemable in 2019 but may be redeemed earlier, as from 2016 at the issuer’s discretion.
The bonds are guaranteed by Corinthia Palace Hotel Company Limited (CPHCL).
Net proceeds will go mainly towards redeeming the outstanding amount of the 6.7 per cent bonds 2009, while the remaining balance is to be advanced to CPHCL for use in its general corporate funding purposes.
Such funds, the group said, will be employed to enable the group to further develop business opportunities arising from its continued expansion.
Subscriptions open on Tuesday 15 September the offers close on Friday 18 September, or earlier if over-subscribed.
Existing Corinthia Finance plc 6.7% 2009 bondholders will be given preference over other investors.
As a gesture of appreciation to investors opting to roll-over their existing bonds, Corinthia Finance will be compensating the difference between the interest receivable on the Maturing 6.7% 2009 Bond and that receivable on the new 6.25% 2019 Bond for the period 23 September 2009 and 30 October 2009.
“The Corinthia Group is extremely indebted to the general public who year after year has supported its strategic direction and growth by partaking in the group’s successes, both locally and overseas,” remarked group chairman and chief executive officer Alfred Pisani.
“Likewise, we are indebted to our international strategic partners for their contribution to the group over a long period of time. Corinthia is a successful home-grown group of companies flying the Maltese flag whenever it ambitiously ventures into new overseas territories in search of further growth across its areas of business.”
Through its subsidiary companies, CPHCL is currently engaged in completing existing projects and developing new sites in various overseas territories with an approximate total value of e850 million worth of investments.
The group is currently developing three projects in Libya (Benghazi, Tripoli and Janzour), another in London, and another still in St Petersburg, where, after the completion and inauguration of the extension to the Corinthia St Petersburg Hotel, the project is now in its final stages with all that remains being the retail and commercial areas adjacent to the hotel.
Corinthia Finance plc was incorporated in 1999 as a financing arm for Corinthia Palace Hotel Company Limited to enable the latter to undertake the ownership, development and operation of real estate developments.
Corinthia Finance Chairman Joseph Fenech adds, “The Corinthia Group is a developer, owner and operator of upscale hotels across continents, employing thousands of Maltese and foreigners. Backed by this unique combination of experiences, a successful track record and solid strategic partners, the group stands in a strong financial position with more ambitious growth plans in store.
“We are confident that our existing investors in Corinthia Finance plc will react positively to this bond offer to continue supporting the group’s growth.”
An application has been lodged with the listing authority for the admissibility of the bonds to listing, as well as to the Malta Stock Exchange for the bonds to be listed and traded on its official list.
The bond is jointly managed by HSBC and Bank of Valletta, which also acts as Bond Registrar. Charts Investments Management Services Ltd is the sponsoring stockbroker while GVTH Advocates serve as legal counsel.