IZI Finance plc - Details of New Bond Issue
On 24 March 2022, IZI Finance plc published a Prospectus following regulatory approval for the admissibility to listing on the Official List of the Malta Stock Exchange of €30 million 4.25% unsecured bonds maturing in 2029. The Issuer is the parent and holding company of a number of subsidiaries which, in turn, are involved in a wide range of gaming business verticals as follows:
- Retail gaming: this business segment entails the operation of electronic gaming machines (“EGMs”) and retail sports betting (including virtual sports and e-sports) through a network of 36 high street stores located across Malta under the ‘IZIBET’ brand. Moreover, the Group operates Malta’s largest bingo hall and is also the authorised partner of the French state-owned company PMU which provides exclusive off-track betting on French and other international horse racing events.
- Dragonara Casino: the Issuer has a 60% shareholding interest in Peninsula Gaming Group Ltd (“Peninsula”) which, in turn, has a long-term temporary sub-emphyteusis agreement expiring in 2083 for the lease of the landmark Dragonara Casino and adjoining grounds. Moreover, Peninsula owns the concession up to 2031 for the operation of the Dragonara Casino. At present, the Dragonara Casino operates 265 slot machines and 15 live table games which is well below its licence for a maximum of 375 slot machines and 25 live tables.
- National Lottery: IZI Finance has very recently concluded a ten-year concession agreement with the Government of Malta for the operation of the National Lottery as from early July 2022. The strategy to be adopted for the National Lottery entails tapping and leveraging into the strong inherent demand for the existing portfolio of games of the National Lottery as well as create additional demand through the introduction of new gaming concepts targeting different audiences especially the younger generations and tourists. Moreover, the Group will initiate a process through which it aims to create a more effective and efficient distribution network of games which would also be complimented by a strong programme of investments in modern technology that would not only offer improved player experience but also the highest level of compliance standards.
The salient details of the new bond issue are as follows:
Coupon:
4.25%
Amount Offered:
€30 million (nominal)
Issue Price:
100% (par)
Maturity:
14 April 2029
Interest Payment Date:
Annually on 14 April (first interest payment date is 14 April 2023)
Ranking of the Bonds:
The bonds constitute the general, direct, unsecured, and unconditional obligations of the Issuer and will, at all times, rank pari passu, without any priority or preference among themselves. In addition, save for such obligations as may be mandatorily preferred by law, the payment obligations of the Issuer under the bonds will, at all times, rank at least equally with all the Issuer’s present and future unsecured and unsubordinated obligations.
Use of Proceeds:
The net proceeds from the bond issue, estimated at €29.4 million after issuance costs, will be used as follows:
- €16.2 million for capital expenditure related to the National Lottery concession, including (i) the installation of hardware, terminals, systems, telecommunications equipment and services, as well as staff and reseller training programme; (ii) the development of lottery software systems and back-office applications; (iii) the rental of office space and warehouse facilities; (iv) the modernisation and upgrading of the distribution network; and (v) the development and registration of the National Lottery brand.
- €8.5 million for capital expenditure related to the Dragonara Casino concession agreement, including: (i) upgrades to the casino management system and other software developments; (ii) external and internal improvements to the Dragonara Casino building; (iii) purchase and maintenance of equipment related to slot machines, gaming tables, food and beverage, IT and surveillance; as well as (iv) electrical and mechanical installations.
- €3.9 million for capital expenditure related to the retail gaming operations, including the purchase of new gaming equipment and the refurbishment of existing retail outlets.
- €0.8 million for general corporate funding purposes.
Plan of Distribution:
- Placement Agreements: An amount of €15 million has been reserved for subscriptions by Authorised Financial Intermediaries through Placement Agreements.
- Intermediaries’ Offer: An amount of €15 million will be available for subscriptions by Authorised Financial Intermediaries through an Intermediaries’ Offer.
Closure of Offer Period:
7 April 2022 at 12:00 hrs (noon)
Minimum Subscription Amount:
€5,000 (nominal) and in multiples of €100 thereafter
Listing:
Official List of the Malta Stock Exchange
Expected Listing Date:
25 April 2022
Downloads:
Prospectus dated 22 March 2022
Investor Presentation – This document has been included on the Issuer’s website for informational purposes only. No reliance whatsoever should be placed upon this documentation as the basis of any investment decision to subscribe for any financial instruments issued by IZI Finance plc.
Disclaimer:
This webpage has been prepared based on the Prospectus dated 22 March 2022 issued by IZI Finance plc and no representations or guarantees are made by Rizzo, Farrugia & Co. (Stockbrokers) Ltd with respect to the accuracy of the data. This webpage is for information purposes only. It is NOT intended to be and should NOT be construed as an offer or solicitation to acquire or dispose of any of the securities or issues mentioned herein. Rizzo, Farrugia & Co. (Stockbrokers) Ltd accepts NO responsibility or liability whatsoever for any expense, loss or damages arising out of, or in any way connected with, the use of all or any part of this webpage.
Investors wishing to acquire the Bonds should read the Prospectus before making any investment decision in order to fully understand the potential risks and rewards associated with an investment in the Bonds. A copy of the Prospectus is available on Rizzo, Farrugia & Co. (Stockbrokers) Limited’s website. Prospective investors are urged to consult their financial advisers as to the suitability or otherwise of acquiring such Bonds. The value of the investment and the income therefrom may go down as well as up and investors may lose some or all of the money invested.
This ADVERTISEMENT has been issued by Rizzo, Farrugia & Co. (Stockbrokers) Limited which is a company licensed to undertake investment services in Malta by the MFSA under the Investment Services Act, Cap. 370 of the Laws of Malta and a member of the Malta Stock Exchange. The Company’s registered address is at Airways House, Fourth Floor, High Street, Sliema SLM 1551, Malta. Rizzo, Farrugia & Co. (Stockbrokers) Limited is acting as Sponsor and Co-Manager of the Bond Issue.