Qawra Palace p.l.c. 5.25% Secured Bonds 2033

Qawra Palace p.l.c. (the “Issuer”) has announced the issuance of €25,000,000 5.25% Secured Bonds maturing in 2033, having a nominal value of €100 per bond issued and redeemable at par. 

Please find the prospectus relating to the aforementioned bonds (the “Prospectus”) here.    

Business Overview 

The Qawra Palace is a four-star hotel established in 1985 located on the Qawra promenade, which is managed and operated by Mallard Co Limited (C 4758), pursuant to the QP Lease & Operating Agreement, as defined in the Prospectus. The Qawra Palace’s existing facilities include 394 rooms, indoor and outdoor pools, a games room, mini-golf facilities and six food and beverage outlets.  

The majority of incoming residents at the Qawra Palace hail from the United Kingdom (71.83%), with Italy (7.49%), France (5.01%) and Germany (2.15%) also constituting popular target markets . Its primary source of income is derived from its occupancy rates; accounting for approximately 62% of the total revenue generated. Business is predominantly derived from three sources, namely: (i) tour operators, (ii) third-party online reservation systems, and (iii) bookings made directly via the Qawra Palace’s website. The Qawra Palace’s management enjoys a good relationship with a wide network of tour operators, and this source of business accounts for over 50% of the Qawra Palace’s total sales. Conversely, the revenue generated from third-party online reservation systems accounts to 35% of the Qawra Palace’s sales, while the remaining 15% are the result of direct bookings. 

The Qawra Palace is currently undergoing a major extension and refurbishment project pursuant to which it intends to shift its business strategy going forward to cater for the luxury all-inclusive sector, by focusing less on the delivery of a cost-effective, all-inclusive experience to its guests, and more on providing the type of luxurious experience which would attract a new niche of travellers as well as forge brand-loyal clientele. 

Use of Proceeds 

The net proceeds from this bond issue, which net of the bond issue expenses are expected to amount to approximately €24,600,000, will be utilised for the following purposes, in the order of priority set out below: 

(1) €16,400,000 will be used for the purpose of repaying the outstanding amounts of the existing loan facilities between the Issuer (as borrower) and BOV described in section 4.4 of the Prospectus; 

(2) €6,700,000 will be utilised to partly finance the extension and refurbishment of the Qawra Palace property and will for this purpose be on-lent to Mallard Co Limited to further complement the amount borrowed by it under the  loan agreement entered into between Mallard Co Limited (as borrower) and the Issuer, as described in section 4.4 of the Prospectus; and  

(3) €1,500,000 will be utilised for general corporate funding purposes. 

Ranking of the bond 

The Issuer shall secure its obligations under the Bond Issue by virtue of a second-ranking special hypothec over the Qawra Palace property, with a first-ranking special hypothec, being granted to Bank of Valletta. For more information, please refer to sections 7.6 and 9.4 of the Prospectus. 

How to Apply: 

Our Moneybase Invest clients can apply online whilst our Financial Advisory clients can speak to their Financial Advisor at one of our four branches (Mosta, Sliema, Birkirkara and Fgura) by contacting us on +25 688 688 or [email protected] or via live chat on ww.cc.com.mt 

Should you prefer to apply through our Moneybase Invest platform, kindly look up 5.25% Qawra Palace 2033 and specify the amount of bonds for which you would like to subscribe. 

The minimum application amount is €2,000 and in multiples of €100 thereafter.  

Non-nominee applications will be subject to a €25 fee. 

The value of the investment can go down as well as up and past performance is not necessarily indicative of future performance. Investing in the bonds of the Issuer may result in a loss of some or all of the capital invested. Prospective investors wishing to subscribe to the bonds should make their own assessment as to the suitability of the investment after reading the Prospectus to fully understand the features of the investment and the potential risks and rewards associated with the bonds. Prospective investors are to consult their independent financial advisor as to the suitability or appropriateness of investing in the bonds. Prospective investors are advised that where an appropriateness assessment is not required investors do not benefit from the corresponding protection afforded under the Conduct of Business Rules.  

This advertisement was approved for issue by Calamatta Cuschieri Investment Services Limited, which is licensed to undertake investment services in Malta by the MFSA under the Investment Services Act, Cap 370. CCIS, Ewropa Business Centre, Triq Dun Karm, Birkirkara BKR 9034, Malta.