Sisal Group S.p.A. (“Sisal Group”), together with certain of its subsidiaries, entered into an investment agreement  with Banca 5 S.p.A. (“Banca 5”), part of the Intesa Sanpaolo banking group, for the creation of a partnership offering banking products as well as payment and transaction-oriented services. The investment agreement is subject to customary conditions, including antitrust clearance and the clearance from the Bank of Italy. 

The new company resulting from the partnership (the “NewCo”) will constitute the first Italian network built on a proximity banking model and will be owned as follows: (i) 70% by Sisal Group and (ii) 30% by Banca 5.

Sisal Group, directly and through its subsidiaries, and Banca 5 will contribute their respective payment and telco businesses to NewCo and the subsidiaries that will be wholly owned by NewCo. 

NewCo will not be part of the restricted group for purposes of the indenture governing the €325 million Senior Secured Floating Rate Notes due 2022 and €400 million 7.00% Senior Secured Fixed Rate Notes due 2023, issued by Sisal Group on July 28, 2016. The formation of the partnership is expected to be partially funded through a debt financing at NewCo, with approximately €500 million of proceeds  to be received by Sisal Group, which in turn will be contributing a business which generated approximately €68 million of EBITDA in the twelve months to March 31, 2019. Sisal Group expects to use a significant portion of such proceeds to redeem its debt securities and repay amounts outstanding under Sisal Group’s revolving credit facility.  
 

This release constitutes a public disclosure of inside information by Sisal Group S.p.A. under the Market Abuse Regulation (EU 596/2014 (16 April 2014)).