International Hotel Investments bond hits record over-subscription

International Hotel Investments’ €45 million bond issue, maturing in 2025 at a coupon of 5.75% per annum, has been heavily oversubscribed.

The company received applications totalling €186 million for its €45 million bond offering, meaning that its offer was more than three times oversubscribed.

More than 82% of bondholders in the bond that is being redeemed exercised their option and converted their holding into the new bond.

“IHI considers this to be an enormous vote of confidence by the investing public in the company,” the company said. “We express sincere appreciation for the overwhelming support received, for which the board and management wish to thank existing bondholders, the managers to the issue, financial intermediaries and the investing public.”

The total value of the subscription is Malta’s largest ever for a corporate bond in real terms, and the largest ever over-subscription in relation to the size of bond being issued.

The offer was closed on the same day it opened on Monday 4 May.

IHI owns seven Corinthia hotels in Malta, Lisbon, Budapest, Prague, Tripoli and St Petersburg, as well as a half share in the luxury Corinthia Hotel in London, besides extensive commercial and residential real estate in several of these cities.

IHI acts as investor and developer of hotels and real estate, as well as owner and operator of the Corinthia Hotels Brand.

Assets are valued in excess of €1 billion, and EBITDA in 2014 stood at €35 million despite reduced demand for hotel accommodation in Tripoli and St Petersburg, balanced by record performances in all other hotels in the portfolio.

Besides the redevelopment project in Malta, IHI plans to roll out a number of new Corinthia Hotels in major cities in Europe and elsewhere in the coming years, principally as a developer and operator acting on behalf of third party investors.