Duke Royalty Limited Inaugural royalty financing agreement (7317B)
April 06 2017 - 2:00AM
UK Regulatory
TIDMDUKE
RNS Number : 7317B
Duke Royalty Limited
06 April 2017
6 April 2017
Duke Royalty Limited
("Duke" or the "Company")
Duke Royalty enters into inaugural royalty financing agreement
with Temarca B.V.
Duke Royalty Limited (AIM:DUKE) ("Duke" or the "Company") is
pleased to announce that it has entered into its inaugural royalty
financing agreement for EUR8.0 million (the "Financing") with
Temarca B.V. ("Temarca"), an established European river cruise
provider. The Financing will allow Temarca to purchase two boats
that are currently being leased, refurbish a portion of their fleet
and repay existing creditors. With a cash-on-cash yield of
approximately 13 per cent., this inaugural royalty financing
agreement results in Duke operating at a cashflow positive run
rate.
New Royalty Partner - Temarca B.V.
Temarca is a Netherlands based river cruise provider that offers
luxury four-star multiday riverboat cruises on Europe's main
rivers, the Rhine and Danube, covering an area stretching from the
North Sea to the Black Sea. Founded in 1997 and family owned,
Temarca has grown to become an established European river cruise
provider with more than 100 employees and a fleet of three vessels.
Temarca works with 28 different travel agencies across Europe,
North America, and South Africa to design unique trips for its
customers. Such travel agencies buy boat capacity approximately one
year in advance of sailing. In order to accommodate strong and
growing demand for river boat cruises, this Financing allows
Temarca to expand and update their fleet.
Under the terms of the Financing, Duke will provide EUR8.0
million (approximately GBP6.9 million) to Temarca with an option at
Duke's sole discretion to provide an additional EUR2.0 million
(approximately GBP1.7 million) for a period of 12 months. The first
tranche of the Financing will entitle Duke to monthly distributions
(the "Distribution") beginning in May 2017 which totals over EUR1.0
million (approximately GBP0.9 million) on an annual basis, equating
to a cash-on-cash yield of approximately 13 per cent. The
Distribution will be adjusted annually with the first adjustment
occurring on 1 July 2018 based on the percentage change in
Temarca's gross revenues for the year to 31 December 2017 compared
to the prior year. The annual adjustment in the Distribution will
be subject to a collar. The term of the Financing is for a period
of 25 years, will be senior secured and Duke has provided Temarca
with a buyback option.
"The partnership nature of Duke's capital allows us to continue
focussing on delivering excellent service while enabling our
company to capitalize on the growth opportunities within the river
cruise market," said Teun Sijbrands, Co-founder and Owner of
Temarca.
"We are delighted to have Temarca as Duke's first royalty
partner. Through Teun and Marijke Sijbrands-Faassen's leadership
since co-founding Temarca in 1997, and their 25 years of experience
in the river cruise industry, Temarca has a long track record of
successful operations," said Neil Johnson, CEO of Duke. "The
investment into Temarca is exemplary of the suitability of royalty
financing to stable, cash flowing businesses, where owners want to
receive capital but retain control." Mr. Johnson continued, "and we
continue to evaluate a number of interesting royalty
opportunities."
About Duke Royalty
Headquartered in Guernsey, Duke Royalty Limited provides
alternative financing solutions to a diversified range of
businesses in Europe and abroad. Duke Royalty's experienced team
and exclusive partnership provide financing solutions to private
companies that are in need of capital but whose owners wish to
maintain equity control of their business. Duke Royalty's royalty
investments are intended to provide robust, stable, long term
returns to its shareholders.
Duke Royalty is listed on the AIM market under the ticker DUKE.
For more information, visit dukeroyalty.com.
For further information:
Duke Royalty Limited Neil Johnson
Charlie Cannon-Brookes
+44 (0) 1481 741 240
Grant Thornton UK Colin Aaronson / Samantha
LLP (Nominated Adviser) Harrison / Jamie Barklem
/ Carolyn Sansom
+44 (0) 20 7383 5100
Mirabaud Securities Peter Krens / Edward Haig-Thomas
LLP (Joint Broker)
+44 (0) 20 3167 7222
Cantor Fitzgerald Marc Milmo / Catherine Leftley
Europe (Joint Broker) / Callum Butterfield
+44 (0) 207 894 7000
The information contained within this announcement is deemed to
constitute inside information as stipulated under the Market Abuse
Regulations (EU) No. 596/2014. Upon the publication of this
announcement, this inside information is now considered to be in
the public domain.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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