Pacha It will use the 18 million in financing granted by the Government, through the Cofides recapitalization fund, to “strengthen the group’s financial position, be able to continue operating and continue to grow when we overcome the pandemic.” This is stated by its president, Manuel Garí, in conversation with this newspaper, following the Ministry of Industry and Commerce confirmed the loan on December 23.
“It is not a ransom,” insists Garí, who defends the access of the Balearic hotel group, known worldwide for its Ibiza disco, to those funds. “We meet all the requirements. It is a loan that bears market interest and a principal that has a maturity. It is not a tailored suit ”, he adds, although he says he does not know the exact terms of the loan for the moment. “We have been summoned at the beginning of the year to make it happen.”
The pandemic had a frontal impact on the Balearic group. In 2020, Universo Pachá scored a consolidated net loss of 61.6 million euros, following reducing its revenue by 93%: from 93.4 million in 2019 to 6.4. In 2021, Garí says, it was “Much better,” with regarding 50% of pre-pandemic income. By 2022, the company expects to get closer to that turnover and exceed it in 2023. The goal, to reach 170 million in 2025, which would represent a growth of 80% compared to 2019.
“During the pandemic we have increased our geographic perimeter, both in Spain, opening in Formentera, and in Mykonos (Greece), monetizing our brands, reaching management agreements, third-party investment that implied a minimum cash outflow”. The company, owned by the Trilantic Capital fund since 2017, sets itself in its business plan the objective of reaching “iconic” locations of international tourism, through its Casa Pachá hotel format, the aforementioned Lio or its nightlife model .
On the radar, London, where he will open his Lio concept of a restaurant with a show this year. On the radar, locations like Las Vegas, Miami or Dubai. At the national level also Marbella, where it will develop a new luxury complex on the old Laguna Village shopping center. “Our investment there will be two million, and we will be accompanied by other partners. We have a multiplier effect and our solvency is proven ”, Garí emphasizes.
This attributes to investments in new assets and locations the losses that the group also recorded before the pandemic. Specifically, 10.3 million in 2019 and 6.3 in 2018. “Growth has to go hand in hand with profitability. We are not going to go to assets that are not profitable ”.
In addition to the Cofides funds, Universo Pachá has accessed 17 million euros in bank loans with ICO endorsement. The company refinanced its debt just before the pandemic, and it currently exceeds 100 million. The group, Garí says, maintains open conversations with its parent banks. “There is a constant dialogue. We have a flexible position ”.
Trilantic celebrates five years as owner
The venture capital fund Trilantic led the takeover of Pachá’s shareholding in 2017, following acquiring nearly 90% of the group from the Urgell family, which holds 10% of it. The operation was valued at around 350 million. Thus, this year marks the fifth anniversary of the transaction, a period that is usually set as a reference for the outflow of funds such as Trilantic. Since it was done with Pachá, it has not received dividends and has run into the pandemic “The only thing I can say is that there is an absolute commitment to professionalize the company and optimize the financial situation,” says the president of Pachá, Manuel Garí , which does not rule out any possibility of exit. “It might be a sale, a merger or an IPO. Any stage is open ”.
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