Mota-Engil seeks €50 million to continue growing across borders

  • ECO News
  • 3 October 2022

The company's bond issue starts today. The construction company is offering an interest rate of 5.75% and a premium of up to €1.25 per bond.

Mota-Engil returns to the bond market today with an issue associated with sustainability criteria. The construction company led by Gonçalo Moura Martins intends to raise €50 million from small investors through a new bond loan called “Obrigações Mota-Engil 2027”.

The operation started today at 8.30 am and will run until October 17. Mota-Engil will make two offers: a Public Subscription Offer and a Public Exchange Offer.

Public Offer for Subscription (OPS): For the new creditors, Mota-Engil assumes the commitment to pay an annual coupon rate of 5.75%, which is to be paid semi-annually until October 20 2027. Bondholders may also be entitled to a premium of €1.25 per bond if Mota-Engil cannot meet certain targets linked to the company’s environmental, social and governance (ESG) practices.

Public exchange offer (OPT): For Mota-Engil’s former creditors who are holders of “Mota-Engil 2022 Bonds”, bonds offering a coupon rate of 4.50% and which will mature on November 22, 2022, the construction company agrees to exchange these bonds for “Mota-Engil 2027 Bonds”. In addition, investors who take this decision will still receive a cash premium of €2.375 per bond.

According to the bond operation’s prospectus, Mota-Engil expects to use the amount raised to finance its current activity and continue to promote its international expansion strategy.

In addition, through the public exchange offer, Mota-Engil will be able to replace part of its debt maturing in 2022 with debt with principal repayment in 2027, thus lengthening the maturity of its debt which is mostly concentrated to mature in the next three years.

“Mota-Engil Bonds 2027” Technical Information

  • Nominal Value: €500
  • Minimum investment: 5 bonds, corresponding to a minimum investment of €2500
  • Coupon rate: 5.75%
  • Additional remuneration: €1.25 per bond, in the event that Mota-Engil does not comply with the target defined in terms of the non-fatal work accident index with sick leave by June 30, 2027
  • Term of the offers: Between March 3 and October 17, 2022
  • Repayment date: October 20, 2027
  • Interest: Coupon payments will be made semi-annually on April 20 and October 20 of each year
  • Admission: The bonds will be admitted to trading on Euronext Lisbon on October 20, 2022