The Board of Directors of Prisa has approved the terms for the refinancing of its debt, which extends its maturity until 2025, the publisher has communicated in a statement.
At the same time, it has agreed to the sale of its educational publisher Santillana España to Finland’s Sanoma worth the asset of 465 million euros, an amount that will be fully satisfied in cash at the date of the close of the transaction, once the net debt is deducted as of June 30, estimated at about 53 million, Efe reports.
Santillana’s private and public activity in Latin America will be excluded from the operation and will continue to be carried out by Prisa, in directly, through the publishing house. In addition, Santillana will retain ownership of all its trademarks and will enter into an exclusive license agreement in favor of Sanoma for the use, among other rights, of the marks “Santillana” and “Loqueleo” in the European Union, excluding Portugal, and the brand “Richmond” in Spain.
The debt refinancing agreement means extending its maturity until March 2025, with an initial cost of 5.5% and an average total cost of 7% over the life of the contract. It envisages the repayment of 400 million debt (the total net debt will be cut by more than 30%) and establishes the framework for a future effective separation of education and media businesses. With this refinancing, the company will have around 275 million to strengthen its liquidity and facilitate the development of the strategic plans of its businesses.
The price for the sale of Santillana Spain has been established on a company value of 465 million euros, which is a multiple of 9.6 times on the average ebitda of the educational cycle of the period 2017/2019, above the multiples of the main comparable transactions in the sector. The price will be paid in full cash on the closing date of the transaction, once the net debt is deducted as of June 30, 2020 from the business subject to the transaction, estimated at EUR 53 million. The sale will generate a consolidated capital gain estimated at EUR 385 million.
After the sale of the business of Santillana Spain, which represents 21% of the business of Grupo Santillana, it will focus its efforts on the boost of learning systems in Latin America.
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