Further to previous announcements, C.C.C. Tourist Enterprises Public Company Ltd, wishes to make the following additional clarifications:
L’ Union Nationale (Tourism and Sea Resorts) Ltd is the owner of Le Meridien Limassol Spa & Resort and is engaged in the hotel business and upscale real estate developments. Since the economic crisis which commenced in 2009, the financial results of L’ Union Nationale (Tourism and Sea Resorts) Ltd have been negative, due to, among other reasons, its high debt level, foreign exchange differences and deferred taxation write-offs. For the years 2012 and 2011 L’ Union Nationale (Tourism and Sea Resorts) Ltd had after tax losses of €7 million and €3,5 million respectively.
To reverse the above situation, the Board of Directors prepared a Business Plan that provided for the renovation of the Resort with equity capital so that its improved competitiveness would allow its operating profits to be over and above the financial expenses and capital repayment obligations. In order to achieve this target, a strategic partner that shared the same vision was sought. The Eurogroup decision, however, with its disastrous effects on Cyprus Economy and also on the investors’ confidence made this target not only harder to achieve but also much more vital. In spite of these harder conditions, the efforts of the Board of Directors were ultimately successful, and resulted to the announced deal of October 2013.
The short term effect of the transaction in the results of C.C.C. Tourist Enterprises Public Company Ltd is expected to be negative as the asset values had not been restated following the Eurogroup decision and its effect. The exact impact will be calculated on the conclusion of the agreement and will then be announced.
The Transaction was made at an arm’s length basis, and the contracting party (Emerald Coast Properties Ltd) had no relation with the Company or its Directors.
C.C.C. Secretarial Ltd
Limassol, 25th October 2013