Accor - Debt Financing

This section illustrates the Group’s solid finances, in particular with information on our debt structure and financing strategy.

Financing Policy

An internationally recognized signature allows Accor to raise various forms of financing, including through bond issues, private placements and bank loans.

From time to time, the Group also takes advantage of market opportunities to raise financing in a given currency and at a given rate of interest and then use a swap to convert the facility into the currency and interest rate required to finance business needs.

Generally, the Group’s policy is to finance its assets and operating requirements in the currency of the country concerned in order to create a natural hedge and avoid any currency risk.

By using its subsidiaries’ surplus cash as well as the financial instruments described above, the Group is able to optimize the cost of its resources while reducing currency risks.

Debt structure

On June 29th, 2018, Accor has signed a €1,200 million Revolving Credit Facility. Accor exercised its 2 one-year extension options extending the maturity to June 2025. Moreover, the margin is dependent on the Group's performance in terms of Environment, Social and Governance (ESG).

For this revolving credit facility, the acceleration clause can be triggered if the Group does not comply with the leverage ratio covenant (consolidated net debt [1] to consolidated EBITDA). This ratio won’t be tested over 2020, since the Group obtained a covenant holiday.

On May 18th, 2020, Accor has signed an additional €560 million Revolving Credit Facility. The credity facility has a 12-month tenor with two six-months extension options in the hands of Accor and has neither covenant nor restriction.

At December 31, 2020, 72% of bonds and bank borrowings was at fixed rate, with an average rate of 1.1%, and 28% was with variable rate, with an average rate of 2%. The fixed rate debt is denominated primarily in Euro (41%).

[1] Restated for lease liabilities (IFRS 16)

Ratings

Credit ratings assess the credit worthiness of the Group and its ability to pay its debt.

Accor is followed by the credit rating agencies Standard & Poor’s and Fitch Ratings which assign to Accor the following rating:

Standard & Poor’s: BB+ with negative outlook
Fitch Ratings: BB+ with stable outlook

Bond issues

As of end-August 2021, bond issues break down as follows:


Type	Issue Date	Maturity	1^st Call Date	Coupon ⁽¹⁾	Principal	Outstanding	Currency
Senior	December 2014	February 2022		2.925%	60M	60M	EUR
Senior	June 2014	June 2022		3.000%	150M	150M	CHF
Senior	September 2015	September 2023		3.625%	500M	294M	EUR
Senior	January 2017	January 2024		2.500%	600M	357M	EUR
Senior	February 2019	February 2026		3.000%	600M	600M	EUR
Convertible	November 2020	December 2027		0.700%	500M	500M	EUR
SLB	November 2021	November 2028		2.375%	700M	700M	EUR
Perpetual	January 2019		April 2024	4.375%	500M	500M	EUR
Perpetual	October 2019		April 2025	2.625%	500M	500M	EUR

(1) Coupon including step-up resulting from S&P rating downgrade in August 2020

Financial Operations

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Prospectus