Dalata, Ireland’s largest hotel group, has announced its first foray into the private debt market after completing a €125 million placement of senior secured loan notes.
The Clayton and Maldron brand owner, which also announced the refinancing of its €475 million main bank facilities on Thursday, said there was strong demand for the issuance, which will provide additional liquidity to deliver on its growth strategy.
“We are delighted to announce the successful completion of our refinancing,” said Carol Phelan, chief financial officer at Dalata. “This increases our debt capacity to €600 million, diversifies our funding sources and enhances the flexibility under the agreements.”
The Dublin-listed group previously had a €200 term loan facility and a €305 million revolving credit facility with lenders AIB, Bank of Ireland, Barclays Bank and HSBC, due to mature in October 2025.
The refinancing deal announced on Thursday – which sees Dalata’s existing banking syndicate joined by NatWest – comprises a green term loan facility of €100 million and a €375 million revolving credit facility, maturing in October 2028 with the option of two one-year extensions.
Dalata, which also owns and operates the Gibson Hotel in Dublin 1, had undrawn debt facilities of €282.4 million at the end of June, according to its half-year results, published last month.
In a first for Dalata, the group also announced the completion of a €125 million private placement of senior notes, comprising €62 million and £52.5 million (€62.75 million) with an annual average interest or coupon rate of 4.6 per cent and 6.2 per cent respectively. The notes are designated ‘green’ under the UK Loan Market Association’s criteria for environmentally sustainable credit.
Dalata said the note-holders are “high quality institutional debt investors”.
Ms Phelan said the group is pleased to have secured its inaugural private debt placement “on attractive terms”, which demonstrate the quality of Dalata’s credit. “These new facilities reflect the confidence of our partners, further enhance the group’s strong balance sheet and enable us to continue to deliver on our ambitious growth strategy”.
The group, which has €1.7 billion of hotel assets under management and is headed by chief executive Dermot Crowley, has heavily prioritised UK growth in recent years, reaching 5,000 rooms across Britain by the end of June, up 20 per cent since the start of 2023 and almost double the number it had four years ago.
In its half-year results, Dalata said it had “considerable financial firepower” to continue to expand in the “UK, large European cities as well as maintaining [its] market share in the larger Irish cities”.
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