We are pleased to inform you that you that FES Finance plc announced the issuance of €5 million Secured Bonds maturing in 2029. This bond will offer a coupon of 5% per annum and shall be issued at a price of €100 per bond.

Should you be interested in investing into this bond, kindly contact your investment advisor. Cheques are to be made payable to Jesmond Mizzi Financial Advisors Ltd. The minimum subscription amount for each application has been set at €5,000 with multiples of €100 thereafter.

Prospective clients should refer to the Company Admission Document dated March 6, 2019 which may be obtained in hard copy from our offices,  or by clicking here.

You may contact us by phone on freephone number 8007 2206 or speak to our Investment Advisors at one of our branches in Hamrun, Valletta, Birkirkara orTa’ Xbiex (by appointment). We will be pleased to answer any queries you may have on this issue and assist in the completion of all the necessary forms.

Issuer – An Overview

FES Finance plc was registered on November 15, 2018 as a special purpose vehicle to act as a financing company through which FES Projects Limited will finance the projects as outlined in the Use of Proceeds in the Company Admission Document. The Issuer is, except for two shares, fully owned by the parent company of the group, and the guarantor of the bond.

The Guarantor, FES Projects Limited was registered on December 6, 2017 and acts as a mother company, and a holding company for the Group, raising finance and capital for its operations. The guarantor is also the owner and manager of two boutique hotels. The said properties will also be pledged for the purpose of providing security for the bond being issued.

The Guarantor is principally engaged in investing in, acquiring or leasing, holding and managing boutique hotels for the purpose of deriving income therefrom, either directly or through subsidiary companies. The Group’s principal activity is overseeing the management of the Boutique Hotels as follows:

the Gzira boutique hotel: an existing 28-room boutique hotel with external entrances and access from number six (6), seven (7) and eight (8), Ponsomby Street, Gzira, being increased to a 56-room boutique hotel including commercial outlets and at the lower floors, following conversion of unutilised space and development of the adjacent property.

the St. Julian’s boutique hotel: a 23-room boutique hotel consisting of 10 superior rooms and 13 suites, with views, pool and decking area, breakfast area, roof top bar and café, following development on a site including airspace, as well as an adjacent plot of land, situated at twenty-one (21), Triq Wied Ghomor, St. Julian’s.

Purpose of Issue

The proceeds from the Bond Issue, which net of issue expenses are expected to amount to approximately €4,898,000, will be used by the Issuer for the following purposes in the following order of priority, and should the amount not be utilised in full, such additional proceeds will be used for the following purposes:

a maximum amount of €3,320,000 of the proceeds from the Secured Bonds will be advanced under title of loan to the Guarantor to acquire the Gzira boutique hotel. €2,650,000 are due as consideration for the acquisition of the property; €500,000 are due as consideration for the movables being acquired together with the immovable; and the remaining €170,000 shall be utilized in order to cover transaction costs. Until such time the said payment becomes legally due, the proceeds shall be held on escrow by the Escrow Agent;

a maximum amount of €467,000 of the proceeds from the Secured Bonds will be advanced under title of loan to the Guarantor to convert/develop the Gzira boutique hotel. Until such time the said payment becomes legally due, the proceeds shall be held on escrow by the Escrow Agent;

a maximum amount of €1,111,000 of the proceeds from the Secured Bonds will be advanced under title of loan to the Guarantor to acquire the St. Julian’s site by means of an emphyteutical grant and to develop same into a boutique hotel. Until such time the said payment becomes legally due, the proceeds shall be held on escrow by the Escrow Agent;

any remaining balance of the net Bond Issue proceeds will be advanced under title of loan to the Guarantor and will be used for general corporate funding purposes. 

Ranking

The Secured Bonds shall constitute the general, direct and unconditional obligations of the Issuer and shall at all times rank pari passu, without any priority or preference among themselves. The Secured Bonds shall be guaranteed in respect of both the interest due and the principal amount under said Secured Bonds by the Guarantor in terms of the Guarantee. In respect of the Guarantor, the Secured Bonds shall rank pari passu, without any priority or preference to all other present and future unsecured obligations of the Guarantor, and with first ranking and priority over the Security Property.