New Investment Approach
Gremi International has prepared an update to its investment approach in the RAIF (Reserved Alternative Investment Fund) for the Eco Estrela project, shifting the fundraising structure towards a model that is more widely accepted and recognized by the industry.
In contrast to the old concept (based exclusively on secondary trade transactions), the fund will now be raising USD 50 MM of new funds from the investors for exclusive use accelerating the Eco Estrela project. New investors will be offered shares representing 29.4% of the whole post-money value of the fund. Gremi International is open to selling shares representing another 30.6% of the entity, in a secondary transaction, retaining 40% of the project’s equity. The project is expected to bring IRR 19.2% (16.6% net).
The new approach will:
• Provide investors with an increased sense of security and comfort regarding their invested amounts
• Better reflect fundraising market standards
• Assure investors that the project will go live to successful completion, since above-mentioned amount of USD 50 MM is fully sufficient to start and deliver 2 Six Senses resorts and part of the branded residences
Additionally, in order to enlarge the potential target group of investors, the minimum investment tickets are reduced and differentiated according to investors' country of residence:
• USD 200,000 for EU based investors
• USD 500,000 for Brazilian investors
• USD 1,000,000 for other global investors
RAIF investors willing to buy a Branded Residence, will be offered a special bonus. Purchase of shares for at least USD 1 million will entitle them in the future to (a) priority choice of Branded Residence (b) conversion of RAIF shares into a part of the Branded Residence purchase price at 1 : 1.1 ratio (for example: investor holding shares purchased for USD 1 million can use those to pay USD 1.1 MM of the regular Residence price).
A Bank Commitment Letter has been issued on the 19th of November 2019 by Banco do Nordeste BNB for Six Senses Formosa Bay Project. The total amount of the bank loan will be of USD 51 MM. Banco do Nordeste (www.bnb.gov.br) is a Brazilian regional development bank and the largest institution in Latin America focused on sustainable regional development.
In order to give an additional level of security to investors, the General Partner undertakes not to use the committed funds unless total amount resulting from subscription agreements reaches threshold of at least USD 35 MM (minimum amount required to start and complete the first of two Six Senses resorts plus 5 residences).
Since the above information is just for general information purposes and does not constitute and shall not be considered to be a legally binding offer, please contact our team to get more information.