CEIBA Investments, the real estate company dedicated to investing in Cuba, has raised €25m in an unsecured convertible bond issue.
The 10%, five-year bond was priced at the unaudited net asset value per share at 30 June 2020 of 104.3p and will be admitted to the International Stock Exchange, Guernsey.
The capital will finance the completion of the construction of the Meliá Trinidad Península hotel – a 400 room, beachfront hotel, in Trinidad, Cuba. The proceeds of the bonds may also be used for investment in a logistics warehouse development project, for general corporate purposes, and for other commercial opportunities when they arise, the group said.
It added the bonds were not expected to be used to support any operating costs of the company due to the strong, continuing earnings performance of the company’s largest investment, the Miramar Trade Centre office complex.
The issue was increased from €20m to €25m due to strong investor demands. It is the first major international fundraise into Cuba since the announcement of Cuba’s monetary reforms in December 2020.
The total cost of the issue was less than 1.30% including broker, legal, registration and any other fees payable by the company. The company does not have any other third-party debt financing apart from the bonds.
John Herring, chairman of CEIBA, said: “We are really encouraged to have received this support from both our existing shareholder base and new investors. In turn, we are very pleased to be able
to support Cuba and its economy, through the completion of this unique hotel, especially given the current challenging and uncertain COVID-impacted environment.
“Mutual respect, engagement, confidence and economic growth are essential ingredients for the country to move forward, and it would appear that by carrying out monetary reforms and broadening the legal framework for the private sector, Cuba is taking big steps in the right direction. The funding sourced to complete the Meliá Trinidad Península is another small step towards the future.
“CEIBA is very well positioned to continue its leading role in Cuba’s foreign direct investment sector.”
Sebastiaan Berger, chief executive added: “We are very excited that the funding to ensure the timely completion of this state-of-the-art hotel in Trinidad has now been secured so that it can be
added to the company’s high quality investment portfolio of Cuban mixed real estate assets.
“Investors seem to understand that a window of opportunity is opening and that there are real chances that both tackling the COVID-19 pandemic and the US-Cuban relationship will improve in the foreseeable future.”
CBA : CEIBA raises €25m in convertible bond issue