Meliá takes off with Ibex 35 after agreement with Banco Santander

Meliá’s shares in Ibex 35 skyrocketed after the group yesterday announced the sale of 38.2% of the three hotels to Banco Santander for €300 million.

Shares in Melia Hotels soared 7.76% in mid-morning on the IBEX 35 to €6.59 after at times topping gains of 9%.

Yesterday after closing it became known that the investment company Moon GC&P Investmentsowned by Banco Santander, will allocate 300 million euros for a representative participation in the amount of 38.2% in the authorized capital of the subsidiary of the Meliá Hotels International group, which owns three hotel establishments.

In particular, Moon GC&P Investments will take this participation on April 11 by creating a new type B participation of a preferential nature.

The new joint subsidiary will own three hotel properties managed by Meliá Group: Me London (London), Gran Meliá Palacio de Isora (Tenerife) and Meliá Cala Galdana (Menorca), the hotel company said. These hotels will continue to be managed by Meliá Group under a lease agreement.

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“This agreement is within the framework of Meliá’s asset rotation policy and we welcome the fact that the chain is relinquishing its minority stake in these hotels in conditions similar to the current one, in which hotel ratings are adequately reflected“, basic moments Ivan San Felix Carbajo, Renta 4 analyst

.

The expert also considers it “beneficial” for Meliá to reduce its debt through this operation. “According to our estimates, this operation reduce net debt (excluding rent)/EBITDA 24e ratio to 1.7x and 4.6x, including rentmultiples of 2019 values ​​of 1.2x and 4.2x in 2019 respectively, which we believe is more appropriate.”

Melia is negotiating other transactions to attract new investors in several hotels in Mexico and the Dominican Republic, San Felix Carbajo recalled. “These operations are expected to generate additional inflows of almost €100 million by the end of 2024, which will also strengthen the financial position of the group.”

Rent 4 gives Melia Hotels an “overweight” recommendation with a target price of 7.5 euros, which is 14% above the current price.

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