Novaturas
Notification on material event

“Novaturas” Group attracts EUR 10 million worth investment

The leading tour operator in the Baltic States “Novaturas” Group and the State Investment Management Agency has agreed on EUR 10 million investment in the Company's bonds for a period of six years. The agreement was approved by the Company's Board during the meeting, held on the 17th of February. This agreement allows tourism sector leader to implement planned strategic initiatives and ensure financial security in case any possible alterations may occur in the future due to the changing dynamics of the coronavirus.

Ensured financial security

When making its investment decision, the State Investment Management Agency, which manages the State Aid Fund for Business (SAF), assessed the sustainability of the Company’s business model. "We believe that after the crisis, people will travel around the world again, and “Novaturas” will continue to operate successfully. This SAF provided investment will contribute to “Novaturas” group to ensure its financial liquidity during unsettled period, to maintain jobs and have financial protection against possible alterations in the future, if the changing dynamics of the virus are not favorable for the tourism sector,” says Dainius Vilčinskas, CEO of the State Investment Management Agency.

The investment worth EUR 10 million will reach “Novaturas” group using mixed financial instruments. The Fund will purchase EUR 5 million worth convertible bonds and EUR 5 million worth ordinary bonds issued by the Company. The financing is granted for 6 years period, after which the Company undertakes to redeem the bonds. The Company also has the possibility to redeem all or part of issued bonds before the term of the agreement.

Agreed on more favorable terms with the Bank

The issuing of convertible bonds will have to be additionally approved by the shareholders at the convened general meeting of shareholders. If the shareholders also approve the decision to assign the pre-emptive right to acquire newly issued convertible bonds to the State Aid Fund for Business and after signing the agreement with Fund, AB “Luminor” Bank will also provide the Company with more favorable loans repayment conditions.

AB “Luminor” Bank will reduce the loans interest and extend the repayment schedule of EUR 5.5 million long-term loan until the end of 2023. The Bank will also change the repayment schedule adjusting it to the Company’s projected cash flows and will waive the requirement to keep restricted funds worth EUR 2.1 million by channeling the money to repay the loans. Under the current agreements, the Company must repay the loans until the February of 2023. At the same time favorable conditions for the extension of guarantee limit already for 2022 season are discussed in advance.

Forecasts of a year of recovery

Although last year has been challenging for the tourism sector due to the unprecedented crisis, but accelerating vaccination processes around the world and the rapid travel infrastructure adaptation to new health and safety requirements are met with optimism and signals the recovery of the travel market already this year.

"Throughout the past year, we have worked hard to stabilize the Company's financial situation. It resulted in reached long-term loan agreements worth EUR 5 million and attracted EUR 10 million worth investment which proves “Novaturas” credibility as a financial partner. We appreciate our partners trust in our consistent actions managing the crisis period and accept it both as an evaluation of “Novaturas” team efforts and our partners belief in the potential of the tourism sector. Of course, it will take some time before we can return to pre-pandemic volumes, so we are taking all the measures to secure a larger financial reserve. The attracted investment will help us to further strengthen our leading positions in the Baltics. The financial terms of the agreement are also in favor to ensuring a rapid recovery of the Company once the restrictions are lifted", says Audronė Keinytė, head of “Novaturas” group.

The State Aid Fund for Business invests in medium-sized and large enterprises affected by the coronavirus outbreak. This reached agreement with the Fund also benefits the Company to improve loans repayment conditions.

About “Novaturas” Group

AB “Novaturas” Group is the largest tour operator in the Baltic States, offering summer and winter package holidays in more than 30 destinations worldwide and more than 100 sightseeing routes. In 2019, the group served more than 293 thousand customers.

CFO
Tomas Staškūnas
tomas.staskunas@novaturas.lt
 +370 687 10426