Proposed Placing of 45,454,546 new Ordinary Shares at 110.0 pence per share
easyHotel plc (LSE: EZH) (“easyHotel” or the “Company” and together with its subsidiaries, the “Group”), the owner, developer, operator and franchisor of super budget branded hotels, today announces a conditional placing of 45,454,546 new ordinary shares of 1.0 pence each (“Ordinary Shares”) in the capital of the Company (the “Placing Shares”) at a price of 110.0 pence per Placing Share (the “Placing Price”) to raise approximately £50.0 million (before expenses) (the “Placing”).
The Placing Shares represent approximately 45.2 per cent. of the Ordinary Shares in issue as at the date hereof (“Existing Ordinary Shares”) and the Placing Price represents a discount of approximately 3.9 per cent. to the closing mid-market price of 114.5 pence per Existing Ordinary Share on 21 February 2018, being the latest practicable date prior to the publication of this Announcement.
· Gross proceeds of the Placing of approximately £50.0 million before expenses (approximately £48.8 million after expenses).
· Proceeds of the Placing to be primarily utilised to fund the acceleration of the Group’s owned hotel roll-out strategy.
· Targeted owned hotel pipeline of 1,122 rooms across the UK and Europe in popular business and leisure city centre destinations.
· Targeted owned pipeline builds on the Group’s established portfolio of 2,343 rooms across 26 hotels. A further 2,739 owned and franchised rooms are already committed to and funded and seven of these owned hotels are anticipated to open in the next two years.
· Trading for the year ending 30 September 2018 is in line with Board expectations.
· Board expects its committed owned hotel pipeline under development to make a significant contribution to system sales, revenue and adjusted EBITDA going forward and further expects the investment of new capital in the hotel pipeline to be earnings per share enhancing in the medium term.
· Placing conditional on, inter alia, the passing of the Resolutions which are to be proposed at a General Meeting of the Company to be held on 12 March 2018 and Admission taking place by no later than 13 March 2018.
· Investec Bank plc (“Investec”) is acting as Nominated Adviser and sole broker to the Company.
Guy Parsons, Chief Executive Officer, commented:
“The Group has made excellent progress in line with its strategy to speed up owned hotel development and accelerate the roll-out of franchise hotels to drive returns on investment.
“The strong and ongoing market outperformance of our growing owned hotel portfolio has continued into the current financial year with RevPAR up 10.9% against their competitive set as measured by STR.
“The proceeds from today’s placing will enable us to continue the acceleration of our owned hotel development pipeline, allowing us to take advantage of the significant opportunities within our markets, delivering enhanced returns for our shareholders and underpinning the long-term growth of the easyHotel brand.”
A circular, extracts of which are set out below, containing a notice of General Meeting of the Company (the “Circular”), convened for 11.00 a.m. on 12 March 2018, will be sent to Shareholders today convening the General Meeting at which the Resolutions will be tabled. A copy of the Circular will also be made available on the Company’s website, http://ir.easyhotel.com Capitalised terms used in this Announcement but not otherwise defined have the meaning given to those terms in the Circular, unless otherwise indicated.
easyHotel is the owner, developer, operator and franchisor of branded hotels. Its strategy is to target the super budget segment of the hotel industry by marketing “clean, comfortable and safe” hotel rooms to its customers.
easyHotel’s seven owned hotels currently comprise 702 rooms, and it has a further 19 franchised hotels with 1,641 rooms.
Old Street (London), Glasgow, Croydon, Birmingham, Manchester, Liverpool, Newcastle*.
Belgium (Brussels), Bulgaria (Sofia), Germany (Berlin, Frankfurt), Hungary (Budapest), The Netherlands (Amsterdam: City, Arena & Zaandam, Rotterdam, The Hague), Switzerland (Basel, Zurich), UAE (Dubai), United Kingdom (Edinburgh, London Heathrow, Central London, Luton).
Hotel development pipeline
The Company’s committed development pipeline of owned and franchised hotels currently consists of:
United Kingdom (Ipswich, Sheffield, Leeds), Spain (Barcelona). Subject to planning consent: United Kingdom (Milton Keynes, Cardiff and Oxford*).
UAE (Dubai), Germany (Bernkastel-Kues), Portugal (Lisbon), Turkey (Istanbul), UK (Belfast, Reading), Iran, Sri Lanka, Netherlands (The Hague Scheveningen Beach, Maastricht).
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