REVAL HOTELLIGRUPI AS

ANNOUNCEMENT

 

CONTRACTS WITH IFC

 

Today, on December 20, 1999, the representatives of Reval 

Hotelligrupi AS and International Finance Corporation (IFC) will 

sign a share placement contract and a loan contract. According to 

the contracts, the IFC will invest into the owners' equity up to $2 

million and Reval Hotelligrupp has right to get a loan in the 

extent of 7.7 million euros.

 

The loan agreement with IFC is a final part of the company's 

capital restructuring process. The funds raised in the process will 

be used to refinance outstanding three and four-year loans and 

build up a financial resource needed to launch new development 

projects.

 

The employment of the contracts takes place in two stages: in stage 

1, IFC will place shares at 35 EEK per share, for at least $0.8 

million and give a loan in the extent of 4.9 million euros. In 

stage 2, IFC will place shares in total up to $2 million (taking 

into account the initial payment in stage 1) and give a loan in the 

extent of 2.9 million euros. The prerequisite for the realisation 

of the second stage is a new initial payment into the owner's 

equity in the extent of 2.3 million euros by other shareholders. 

The share placement by the IFC may occur in up to three stages 

until December 31, 2001, the loans can be withdrawn partially 

(minimal disbursement of 0.5 million euros) until December 31, 

2002.

 

The clauses of the loan contract:

- interest rate EURIBOR plus a margin of 3.25%, the margin may be 

lowered in the future

- loan repayment between 2002-2008

 

The financial co-operation with the IFC guarantees Reval 

Hotelligrupp financial resources for the growth potential for the 

next 3-4 years, establishing a resource for various growth 

scenarios (enables to participate in financing the development of 

the real estate if needed). It also guarantees a stable price level 

for the long-term capital and decreases the company's dependence on 

the risks in the Baltic economical environment. 

 

 

Katrin Rasmann

Financial Director

+372 62 74 444