Fashion retail group DIZZ launches €8 million bond issue

Bond issue finances recent franchise acquisitions, bank loans, and new Imriehel commercial headquarters

Diane Izzo, chairperson and executive director of the DIZZ Group
Diane Izzo, chairperson and executive director of the DIZZ Group

The operators of 19 fashion outlets and clothing franchises Terranova, Liu Jo and Calliope, among others, has announced the issue of an €8 million unsecured bond.

Diane Izzo’s DIZZ Group will be offering the bonds at a 5% interest rate, redeemable in 2026.

The Dizz Group was set up by entrepreneur Diane Izzo in 2000 and currently employs 140 full-time staff. “This is a huge milestone for our group of companies and follows a series of other achievements we have made throughout the past year where we have broadened our fashion offering substantially and invested heavily into the retail experiences of our shops,” Izzo said.

Bond funds DIZZ acquisitions

The bond's proceeds, which net of expenses will amount to some €7.7 million, will be used to settle a €2.9 million payment on the acquisition of the Guess, 7 Camicie and Brooks Brothers brands, and the refurbishment and roll-out of the Max & Co and Elisabetta Franchi outlets and the Terranova megastore in Iklin; as well as to acquire new franchises.

Another €2.3 million will be used to reduce the group’s bank indebtedness to refinance loans and overdraft facilities.

The group will also use €1.2 million to finance the construction and development of the €4.1 million ‘The Hub’, a property on Industry Road in Mriehel which will be used to run the group’s critical operations, procurement, a new clothing finishing section and a professional kitchen. The site in question was acquired from the Lands Department, with a deposit of €500,000 paid in May 2016, and an €18,000 ground rent that will run for 65 years.

Another €1.3 million of the bond issue will used for general corporate funding purposes.

According to the prospectus, two Qui Si Sana apartments in Sliema acquired in August 2016 for €770,000 are now the property of the issuer, Dizz Finance plc. An additional balance of €240,000 is due to the vendor upon completion of construction works on the two apartments expected in 2017 – which will be paid by Dizz Finance.

Fast-growing group

DIZZ Group now operates 19 outlets across Malta, concentrated in the St. Julian’s, Valletta and Sliema area. Having opened a Terranova megastore in Iklin in June 2016, the group is now scheduled to open another in Fgura in the coming days.

It also operates a beauty product outlet at Tigné Point (The Make Up Store) and four cafeterias through the representation of the Italian franchise Caffé Pascucci. The Group is currently in the process of acquiring a commercial property in Gzira with a view to converting same into the fifth Caffé Pascucci outlet.

Subsidiary Dizz Manufacturing owns the 65-year emphyteutical grant on the Mriehel plot of some 1,220 square metres that will centralize its warehousing division under one roof. The development will consist of seven floors.