Sol Meliá, Spain’s largest multinational hotel company, has announced a preferred share issue through its subsidiary Sol Meliá Finance of 150 million euros, an amount which may be increased to 300 million euros if required. The preferred shares will pay out a fixed annual dividend equivalent to an annual rate of 8.03% over the first ten years, payable at the end of each quarter. The first dividend payment is scheduled for the 30th. June, 2002.

The issue of preferred shares is the first of its kind for the hotel company and is expected to considerably strengthen the company’s finances, amortize existing debt and thus lengthen the average term of the total debt.

The subscription period will begin as soon as the Spanish Stock Exchange Commission approves the accompanying prospectus and is aimed at individual investors. Subscription orders will be taken for amounts of 10 shares at 100 euros each or upwards until the whole issue has been taken up and will then be traded on the Spanish securities market.

Preferred shares are a financial product that has been used by all of Spain’s principal financial institutions, as well as by many international hotel companies including Host Marriot, FelCor Lodging Trust y Hilton Hotels Corporation.

The banking syndicate underwriting the issue consists of Ahorro Corporación Financiera, BBVA, Banco Urquijo, Bankinter, BankPyme, Caja Madrid, Natexis and ABN Amro .

Sol Meliá is the leading hotel company in Spain, Latin America and the Caribbean, the third largest in Europe and the tenth biggest in the world. The company currently provides more than 350 hotels in 30 countries through its Meliá Hotels, TRYP Hotels, Sol Hotels and Paradisus Resorts brands.

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