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  OL GROUPE company press release from 02/05/2022

  02/05/2022 - 18:05

FINANCING FOR THE LDLC ARENA


FRANCE'S LARGEST TECHNOLOGICAL AND ENVIRONMENTAL ARENA OUTSIDE PARIS

TOTAL INVESTMENT OF €141M, 100% ASSUMED BY OL GROUPE

PROPERTY LEASE (€90M) AND EQUITY/NEAR-EQUITY (€51M)

PROJECTED OPENING DATE: END-2023

Lyon, 2 May 2022

OL Groupe has signed the documentation related to the financing of the LDLC Arena, the new, technologically and environmentally exemplary events venue to be built near Groupama Stadium on the OL Valley site.

Project summary

The LDLC Arena will be among the most modern, technologically and environmentally advanced facilities in Europe. With its seating capacity of 12,000 to 16,000, it will be the largest events arena in France outside Paris. The Arena will benefit from the latest innovations in the realm of connection and user experience. It will round out OL Groupe's events capacity and host between 100 and 120 concerts, seminars, large-scale professional trade shows, e-sport competitions and major sporting events, including the Euroleague basketball games of LDLC ASVEL, which became a permanent Euroleague member in June 2021.

OL Groupe and LDLC signed a naming contract in December 2021, which contributes to consolidating and securing the project. The contract runs from the construction start date and will continue for eight years from the Arena's opening. This contract came on the heels of a 15-year, non-exclusive commercial agreement signed in October 2021 with Live Nation, world leader in shows and concerts, which will enable OL Groupe to attract many internationally-renowned artists to the new arena.

The contract to design and build the LDLC Arena was awarded to the Populous architectural firm and Citinea, a subsidiary of Vinci Construction France. The building permit was granted on 25 October 2021. Land acquisition was finalised on 2 May 2022, thereby lifting the last remaining suspensive conditions of the design/construction contract signed with Citinea. Construction began in January 2022, and the arena is expected to enter service at the end of 2023.

Financing

OL Groupe is responsible for 100% of the financing, via its subsidiary, OL Vallée Arena. Totalling €141m, the investment will be financed through a combination of equity/near-equity (€51m) and a property lease (€90m net).

Equity/near-equity of €51m

  • OL Groupe will issue €10.5m in perpetual subordinated bonds (“TSDI1) to several investors (including Holnest, Jean-Michel Aulas's family office).
  • OL Groupe will also issue €18.5m in recovery bonds (“OR2) to certain “France Relance” (“France Recovery”) bond funds, with repayment at maturity in eight years.
  • OL Groupe will contribute resources of €22m.

Property lease agreement totalling a net €90m

  • OL Vallée Arena, a 100% subsidiary of OL Groupe, has signed a 15-year, amortising property lease agreement with a group of five top-tier banks. The agreement provides for a residual value of 20%.

The average annual interest rate on these financing arrangements will be around 3.8%, subject to future changes in benchmark rates.

1 TSDI (Titres Subordonnés à Durée Indéterminée or permanent subordinated bonds): bonds with no maturity date, under which interest is paid at the discretion of the issuer (subject to prior approval of the Board of Directors). The TSDIs, issued pursuant to Article L.228-97 of the French Commercial Code, are recognised as near-equity in the consolidated financial statements of OL Groupe.

2 OR (Obligations Relance, or recovery bonds): a support system for French companies as part of the French government's recovery plan. The plan includes, among other things, a government guarantee for socially-responsible investment funds qualifying for the “France Relance” programme. The French government considers these instruments as near-equity (deeply subordinated debt), but the ORs are recognized in the consolidated financial statements as liabilities, because interest is paid periodically and the principal is to be repaid at maturity.

 
OL Groupe

Tel
: +33 (0)4 81 07 55 00
Fax: +33 (0)4 81 07 45 65

Email: investisseurs@ol.fr

www.ol.fr
 
Euronext Paris - Segment C

Indices: CAC Small – CAC Mid & Small – CAC All-Tradable –
CAC All-Share – CAC Consumer Discretionary
ISIN code: FR0010428771
Reuters: OLG.PA
Bloomberg: OLG FP
ICB: 40501030 Recreational services

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  Original Source: OL GROUPE