Grupo Posadas to Achieve Sustainable Capital Structure and Remain Mexico's Leading Hotel Operator

MEXICO CITY, Oct. 26, 2021 /PRNewswire/ -- Grupo Posadas S.A.B. de C.V. (BMV: POSADASA) (the "Company") today announced that it has advanced its previously announced debt restructuring by obtaining additional support from holders of its 7.875% senior notes due 2022 (the "Existing Notes"). This consensual financial solution will reduce the Company's debt service obligations and extend the schedule on which its debt matures by 5.5 years, to December 30, 2027, allowing Grupo Posadas to prioritize the use of cash for operating activities to preserve jobs and help maintain the high quality for which its hotels are known.

To implement the financial solution in the most expedited manner, Grupo Posadas and one of its subsidiaries commenced "prepackaged" in-court restructuring proceedings in the U.S. by filing voluntary Chapter 11 petitions in the U.S. Bankruptcy Court for the Southern District of New York. Given that the Company has already obtained the necessary support from noteholders, with 100% of those voting having voted to approve the Company's Plan of Reorganization (the "Plan"), it is expected that the process will be completed within approximately 60 days.

"Today marks the culminating step toward achieving a sustainable capital structure for Grupo Posadas," said Jose Carlos Azcarraga, Chief Executive Officer of Grupo Posadas. "This comprehensive debt restructuring, which we announced two months ago as part of our ongoing efforts to maximize our financial flexibility and best manage the COVID-19-related challenges affecting the entire hospitality industry globally, will enable us to emerge from the pandemic as a financially stronger enterprise. Appropriately capitalized to meet our go-forward business needs and open exciting new properties as tourism further rebounds, Grupo Posadas will be well positioned to continue operating with the highest standards and remain the country's leading hotel operator. We are grateful to have the support of our valued stakeholders as we take this final pivotal step to strengthen our finances. The significant revenue growth we experienced in the third quarter is further proof that Grupo Posadas is poised for long-term success as government restrictions on occupancy continue to ease in many regions in Mexico."

All day-to-day operations, throughout the Company's properties, continue as normal – without interruption – using cash from ongoing operations. Importantly, there will be no impact on the Company's relationships with its employees, guests, agencies, loyalty and vacation club members, suppliers, business partners, or shareholders, and the Company will continue to meet its obligations to these valued stakeholders. Grupo Posadas has filed a number of customary "first day" motions with the Court to support business-as-usual operations on all fronts during the Chapter 11 process; this includes continuation of employee wages and benefits as well as loyalty and vacation club program benefits in the ordinary course. Approval is expected in short order.

Subject to Court approval, the Plan provides for the exchange of the Existing Notes for new senior notes secured by liens on real estate and certain accounts receivable of the Company. All other undisputed claims, including those of suppliers for goods and services provided before as well as during the Chapter 11 process, are unimpaired and will be paid in full in the ordinary course or otherwise satisfied. Common shares of Grupo Posadas are expected to continue to trade in the normal course.

Additional Information

For additional information about the Company's debt restructuring and access to Court documents, please visit https://cases.primeclerk.com/posadas/.

The Company is represented by Cleary Gottlieb Steen & Hamilton LLP as international legal counsel, Ritch, Mueller y Nicolau, S.C. and Creel, García-Cuéllar, Aiza y Enríquez, S.C. as Mexican legal counsel, and DD3 Capital Partners as financial advisor.

About Posadas

Posadas is the leading hotel operator in Mexico and owns, leases, franchises and manages 185 hotels and 28,690 rooms in the most important and visited urban and coastal destinations in Mexico. Urban hotels represent 87% of total rooms and coastal hotels represent 13%. Posadas operates the following brands: Live Aqua Beach Resort, Live Aqua Urban Resort, Live Aqua Boutique Resort, Grand Fiesta Americana, Curamoria Collection, Fiesta Americana, The Explorean, Fiesta Americana Vacation Villas, Live Aqua Residence Club, Fiesta Inn, Fiesta Inn LOFT, Fiesta Inn Express, Gamma, IOH Hotels, and One Hotels. Posadas has traded on the Mexican Stock Exchange since 1992.

Forward-Looking Statements

This press release contains forward-looking statements. Such statements may include words such as "may" "will," "expect," "intend," "anticipate," "estimate," "project," "believe" or other similar expressions. Forward-looking statements are statements that are not historical facts, including statements about our beliefs and expectations. These statements are based on Posadas' current plans, estimates and projections and, therefore, you should not place undue reliance on them. Forward-looking statements involve inherent known and unknown risks, uncertainties and other factors, many of which are outside of Posadas' control and difficult to predict. We caution you that a number of important factors could cause actual results to differ materially from those contained in any forward-looking statement, including, but not limited to, the ability to consummate a plan of reorganization in accordance with the terms of the Restructuring Support Agreement; risks attendant to the bankruptcy process, the outcomes of Bankruptcy Court rulings and the Chapter 11 Cases (the "Cases") in general and the length of time that we may be required to operate in bankruptcy; the effectiveness of the overall restructuring activities pursuant to the Cases and any additional strategies that we may employ to address our liquidity and capital resources; and any other restrictions imposed by the Bankruptcy Court. Forward-looking statements speak only as of the date they are made, and we undertake no obligation to update publicly any of them, whether in light of new information, future events or otherwise.

Investor Contact:
Gerardo de Prevoisin, [email protected]

Media Contacts:
Kekst CNC (U.S.)
Sherri L. Toub / Ross Lovern
[email protected] / [email protected]

Zimat Consultores (Mexico)
Francisco Galindo
[email protected]

SOURCE Grupo Posadas

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