Minoan's share price soars following issue of £1.5m convertible loan notes

6th Nov 2014 15:00

Leisure resort developer, Minoan, has announced the issue of up to £1.5m of three year unsecured convertible loan notes.The loan notes will carry a 10% annual coupon and can be converted into equity at a price of 15.5p.According to Minoan chairman, Christopher Egleton: "The funds [raised] will be used to provide general working capital and to support further acquisitions."In addition to the issue of loan notes, Minoan received further attention from Greek media outlets last night, after authorities approved the terms for a draft Presidential Decree in respect of a project requested by Minoan. Once accepted, the project will allow Minoan to dramatically expand future operations.Shares in Minoan surged 18.30% to 13.90p per share following the announcement as of 15:36 on Thursday. Since summer 2013, shares in the company have tripled in price.House broker, WHIreland First Light, announced a buy recommendation for the company in a comment released on Thursday morning. Analyst John Cummins stated: "We value the group on a sum of the parts methodology, using an implied value for the Crete Project, in combination with a FY 2015E EBITA [earnings before interest, taxes and amortisation] multiple of 8.0x for the Travel business, which results in our share price target of 28p."As such, we maintain our 'speculative buy' recommendation."