IHG taps into £600m BoE funding as sites stay shut

Hotel giant Intercontinental Hotels Group has announced it had secured £600m in commercial paper from Bank of England loans amid the Covid-19 pandemic.

IHG revealed it has secured new financing arrangements to further “strengthen” its liquidity position, which includes amending its syndicated revolving credit facility to include a waiver of existing covenants until 31 December 2021.  

The amendment introduces a minimum liquidity covenant of $400m (£321m), tested at half-year and full-year, up to and including 30 June 2021.

IHG now has access to $1.35bn (£1.1bn) of cash on deposit and existing bank facilities are currently $660m (£530m) undrawn, taking total available liquidity to $2bn (£1.6bn).

The hotel group also announced 50% of its hotels in Europe, Africa, Australia and the Middle East have temporarily closed its doors, with 10% being closed in the US.

It also announced occupancy levels in comparable open hotels are currently in the low to mid 20% range across the business.