Omonia to issue €1.5m bond to repay BoC loan

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By Stelios Orphanides

Omonia, the Nicosia-based football club that is the most popular in Cyprus, said that its intention to issue a €1.5m bond to repay an existing loan was met with interest from potential investors.

“The messages we are getting are very positive,” Costas Constantinou, member of the board of directors said in a telephone interview on Monday. “There is a lot of interest both from fans who want to invest even small amounts and investors”.

The bond, which will carry a 5 per cent annual interest rate, will be also backed by collateral that will include the club’s building in Papanicoli street in Nicosia and the club’s revenue from the sale of television rights, according to the club’s website. The bond will be listed on the Cyprus Stock Exchange’s emerging company market which does not fall under the mandatory provisions of the regulated market.

Constantinou said that the revenue from the sale of the bond will be used to pay back an outstanding loan to Bank of Cyprus and will so help release the building in Papanicoli street as collateral.

According to press reports, Omonia extended in June for another three-year its television rights with cable television provider PrimeTel, which had been due to expire next year. According to the same reports, Omonia will continue receiving an annual €1,75m for the duration of the contract, now set to expire in 2022.

Constantinou said that the bond is not exclusively addressed to Omonia fans, as institutional investors such as insurance companies may also opt to participate in the process. The club will start receiving bids at the end of the current week and the process will be completed within a month or when the amount is covered.

An official of the Cyprus Securities and Exchange Commission said that the body, which supervises the stock and capital market, said that since the bond issue is below the €5m margin, its issue is not regulated.

Immediately after the 2013 banking crisis, Omonia organised a fundraising in order to comply with the UEFA financial standards. The club, which is affiliated with AKEL, was in the media spotlight again last year when its former chairman Miltiades Neofytou sued former president Demetris Christofias asking for the repayment of up to €22m. The sum includes funds Neofytou injected in Omonia, allegedly on pressure from the ex-president.

Constantinou said that the case is unrelated to Omonia.

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  • Mong Hlop

    the akelite commie bankrupt fraud laden fc is applying pure capitalist tools to finance its activities – the irony is telling!!!

    • Cydee

      You’re so right. Hypocrites all.