High Tech Hoteles

Borrower Overview

• Spanish hotel operator in the 3 and 4 star segment of the urban hospitality market
• Mainly occupy landmark buildings in the historical city centre that have been fully renovated and transformed into hotels with cutting-edge services and high-quality equipment

Deal Description

• The Madrid market hit a low point in H1 2014 as a consequence of the domestic economic crisis, which was not offset by international travellers, and the poor situation of the airport
• After two light A&Es in 2009 and 2012, a complex agreement was signed in July 2014 where existing lenders negotiated a restructuring with a secondary exit in mind, that was realised shortly after signing

Kartesia Contribution

• The banks imposed a very restrictive restructuring agreement that prevented the company from investing to capture the recovery in the demand
• Kartesia decided to buy a majority of the debt pool in order to become pivotal and be able to facilitate discussions with the hotel chain, its stakeholders and the remaining lenders

Results

• Kartesia acquired more than 75% of the outstanding debt between July 2014 and March 2015 from six banks
• Being the majority lender, Kartesia became the appropriate partner to negotiate and amend the terms of the existing debt, thereby providing the company and its stakeholders the tools to become the reference urban hotel operator in Spain
• The sponsor sold its stake and Kartesia waived the change of control to support the acquisition by a new shareholder

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