Amadeus gets €1.5bn injection to meet 2020 financial obligations

In an effort to ensure it can meet its 2020 financial obligations, Madrid-headquartered travel technology company Amadeus has issued €750 million in new capital and €750 million in senior convertible bonds to further strengthen its capital position and improve its liquidity to face the “near-term uncertainty” caused by the impact of Covid-19.
Íñigo Berrícano

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In an effort to ensure it can meet its 2020 financial obligations, Madrid-headquartered travel technology company Amadeus has issued €750 million in new capital and €750 million in senior convertible bonds to further strengthen its capital position and improve its liquidity to face the “near-term uncertainty” caused by the impact of Covid-19.


The issuance takes Amadeus’ liquidity to more than €4 billion.


The new capital takes the form of:
 

  • Approximately €750million of new primary equity – 19,230,769 new shares have been issued at a price of €39.00, with a 5.8 per cent discount to Amadeus last trading price.
     
  • €750million in senior convertible bonds, with a nominal price of €100,000 and a coupon of 1.5 per cent have been issued – unless previously converted, redeemed or purchased and cancelled, the Bonds will be redeemed on April 9, 2025.


J. P. Morgan was global coordinator on both parts of the transaction, which also included a delta equity placement to facilitate hedging of the convertible bonds by investors. Crédit Agricole and Citigroup were the bookrunners.


A Madrid-based Linklaters team advised J.P. Morgan, Citigroup and Crédit Agricole. The Linklaters team included Íñigo Berrícano (pictured), Federico Briano, Jorge Alegre and Pablo Medina.


Amadeus was advised by a Madrid-based Freshfields Bruckhaus Deringer team, which included partners José Armando Albarrán and Alfonso de Marcos and counsel Joe Amann.


An Amadeus statement said: “The capital raise was conducted via an accelerated bookbuild, targeted at qualified investors, and has already been completed.


“It is part of a comprehensive program to enable the company to confront even the most adverse scenarios, based on assumptions well below the latest projections for air travel by IATA.”


Amadeus previously announced a series of liquidity measures on 23 March, including:
 

  • Efficiency measures to reduce fixed costs and capital expenditure by an approximate annual run-rate of €300million

     
  • Cancellation of the complementary dividend payment of €320million scheduled for June 2020

     
  • An incremental €1billion loan facility, entered into with a group of banks of reference, with a one-year term, adding to our currently existing liquidity composed of €1billion of undrawn revolving credit facility and €660 million of cash.


The statement said: “Amadeus’ total liquidity position means it is well prepared to meet its financial commitments for 2020.” Amadeus has two financial obligations reaching maturity in 2020:
 

  • €730million in commercial paper (as of 23 March 23 2020)

     
  • €500million in Senior Bonds maturing in October 2020.


The statement continued: “As the impact of COVID-19 continues to affect the travel industry, Amadeus’ priorities remain ensuring the health and well-being of our employees, supporting our customers, and protecting our own business in these unprecedented times.  We believe we are positioned to withstand the current environment with strength, and we remain confident in our long-term, proven strategy for growth and shareholder value creation.”

 

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