Prisa, the Spanish group that publishes the daily newspaper El País, has launched an issue of bonds convertible into shares for up to 130 million euros to reduce the group's debt, in a context of rising interest rates.

The 351,350,000 new shares to be issued through the voluntary or mandatory conversion represent 47.44% of the company's current share capital and 32.17% of the capital after the conversion of the bonds.

"The issue will allow the company, mainly, to obtain the necessary funds to, in accordance with the financing agreements subscribed, partially and early cancel the tranche of Prisa's syndicated financial debt that represents the highest interest financial expense," the company said.

This junior debt tranche amounted to 190 million euros as of October 31, 2022, and is linked to a variable interest rate of Euribor plus 8%.

According to the 2022 first-half earnings report, the group's net debt stood at €915 million.

The conversion price of the convertible bonds was set at 0.37 euros per new share, and the nominal interest rate of the convertible bonds will be a fixed 1.00% per annum, Prisa said late on Monday.

The maturity date of the issue will be five years from the date of issue of the debentures, at which time they will be mandatorily converted into new shares, although investors will be able to make the conversion voluntarily and in advance.

(Information by Tomás Cobos; edited by Flora Gómez)