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Dubai hotelier’s $350m green bond to fund Ibiza expansion

Five Holdings' Dubai hotel Five Jumeirah Village Five Holdings
Five Holdings' Dubai hotel Five Jumeirah Village
  • Debut on stock exchange
  • Proceeds to fund Ibiza expansion
  • Pacha nightclub owner acquired

Hospitality group Five Holdings has listed a $350 million green bond on Dubai’s Nasdaq. 

A spokesperson for Five told AGBI the company would use the proceeds of the bond to fund its acquisition of Ibiza’s Universo Pacha, which owns the famous Pacha nightclub, as well as Destino Hotel and El Hotel Pacha on the Spanish island. 

It is the company’s first stock exchange appearance and a rare fundraising move for a local hotel company. 

A green bond is a type of fixed-income instrument that is specifically earmarked to raise money for climate and environmental projects.

Five was reported in July to be purchasing a €320 million ($336 million) stake in the Ibiza nightlife group.

The green bond features a coupon rate of 9.375 percent amounting to $350 million, with maturity set for 2028, Five said in a statement. 

It said the listing increases Nasdaq Dubai’s total value of ESG-classified bonds and sukuks to $26.7 billion and boosts the total value of debt listed on the exchange to $118.3 billion. 

“Five understands that value creation for stakeholders is essential to sustainable development, which drives our commitment to outstanding figures and environmental responsiveness,” Kabir Mulchandani, chairman and founder of Five, said.

The joint global coordinators for the issuance were CitiBank, Deutsche Bank and Emirates NBD Capital. AAIB, CBD and Mashreq were the joint lead managers.

Five’s hotels include Five Palm Jumeirah, Five Jumeirah Village, Five Luxe and its first international property, Five Zurich.