19 Nov 2009 [09:51h]     Bookmark and Share



Calyon and Deutsche Bank are acting as joint bookrunners and joint lead-managers (the „Joint Bookrunners“) of the Offering. The offering proceeds, which could increase to up to €200 million,will increase the Group’s financial liquidity and further reduce its exposure to uncertain financing market conditions.

Palma de Mallorca – Sol Meliá, S.A. (the „Issuer“ or “Sol Meliá”) announced this morning  that it has launched an offering of senior unsecured Convertible Notes due 2014 (the “Convertible Notes”) of €150 million. The base offering size is €150 million, underwritten subject to customary conditions for this type of transaction, with an upsize option of €25 million which may be exercised between launch and pricing. The Issuer intends to grant a „greenshoe“ option to the Joint Bookrunners (as defined below) to request that the Issuer issue a further €25 million in Convertible Notes, to be exercised at any time between the pricing date and the date falling five business days before the closing date. The book building of the offering of the Convertible Notes (the „Offering“) will commence upon publication of this announcement and is expected to end by the close of business today.  

The coupon will be determined by the Issuer and the Joint Bookrunners and is expected to be between 4.25% and 5.00% per annum payable semi-annually in equal instalments, with an expected conversion premium of between 30% and 35% above the volume weighted average share price of the Issuer’s ordinary shares between launch and pricing.

The Convertible Notes cannot be called by the Issuer for the first three years and 15 days (other than if less than 10% of the Notes are outstanding), and are callable thereafter if the value of the shares underlying a Convertible Note exceeds 130% of the nominal value of a Convertible Note for a specified period of time.

The Convertible Notes will be convertible into existing ordinary shares of the Issuer at the option of the Noteholders, subject to a cash settlement option of the Company. However, Sol Meliá may also opt to deliver newly issued shares, subject to approval from the Issuer’s Board of Directors (which the Issuer will seek following pricing and before the closing date). The closing date of the Convertible Notes is expected to be on or about 18 December 2009.

The Convertible Notes will be offered only to qualified investors within the meaning of Directive 2003/71/EC of the European Parliament and the Council of November 4th, 2003, in accordance with the respective regulations of each country in which the Convertible Notes are offered.

The Offering represents an increase in the Group’s financial liquidity. In addition, the Issuer will use the net proceeds from the sale for general corporate purposes, to lengthen the debt maturity profile of the Group, diversify its sources of funding, and take advantage of the current new issue market conditions for convertible bonds.

Sol Meliá intends to list the Notes on the Luxembourg Stock Exchange’s Euro MTF market. At the close of markets the Issuer shall file with the CNMV a relevant fact duly informing of the final terms and conditions of the Notes.



In connection with the issue of the Convertible Notes, Deutsche Bank, acting as Stabilising Manager (or persons acting on behalf of any such Stabilising Manager) may over-allot Convertible Notes or effect transactions with a view to supporting the market price of the Convertible Notes at a level higher than that which might otherwise prevail. However, there is no assurance that the Stabilising Manager (or persons acting on behalf of the Stabilising Manager) will undertake stabilisation action. Any stabilisation action may begin on or after the date on which adequate public disclosure of the final terms of the offer of the Convertible Notes is made and, if begun, may be ended at any time, but it must end no later than the earlier of 30 days after the issue date of the Convertible Notes and 60 days after the date of the allotment of the Convertible Notes. Any stabilisation action or over-allotment must be conducted by the Stabilising Manager (or persons(s) acting on behalf of the Stabilising Manager) in accordance with all applicable laws and rules.

This announcement is for general information only and does not form part of any offer to sell, or the solicitation of any offer to buy, securities. The distribution of this announcement and the offer and sale of the securities described in this announcement in certain jurisdictions may be restricted by law. Any persons reading this announcement should inform themselves of and observe any such restrictions.

This announcement is directed only at the following persons in the United Kingdom: investment professionals falling within Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (the “Order”); and high net worth entities, and other persons to whom it may lawfully be communicated, falling within Article 49(2)(a) to (d) of the Order.  If you are in the United Kingdom and do not fall into one of the above categories, any investment or investment activity to which this announcement relates is not available to you, and will not be engaged in with you, and you should not act upon, or rely upon, this announcement.

The Convertible Notes being offered and the ordinary shares issuable upon conversion of the Convertible Notes have not been and will not be registered under the US Securities Act of 1933 (the “Securities Act”) and may not be offered or sold in the United States absent registration or an applicable exemption from registration under the Securities Act and applicable state securities laws. This press release does not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of these securities in any state in which such offer, solicitation or sale would be unlawful.

Picture: Carstino Delmonte/

See picture gallery of Sol Melia Atenea Hotel Palma de Mallorca


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