Asda, the UK retailer, has successfully refinanced over £3.2 billion of its debt, citing “strong demand from investors.” This refinancing included what the retailer referred to as “the biggest Sterling high-yield bond this year” and the second-largest Sterling bond in the European leveraged finance market, following Asda’s original £2.25 billion Sterling bond tranche in 2021.
Due to “strong investor demand,” Asda was able to raise £1.75 billion of senior secured notes and increase by over £200 million on a £900 million Equivalent EUR Term Loan B (TLB), bringing the final size to £1.1 billion equivalent. The maturities of the new senior secured notes and TLB are set for 2030 and 2031, respectively. As part of the £3.2 billion refinancing, Asda utilized approximately £0.3 billion of balance sheet cash to reduce gross debt.
Michael Gleeson, Asda’s chief financial officer, expressed, “We saw strong demand from investors after taking a thoughtful and prudent approach to refinancing our near-term debt well ahead of maturities – to further strengthen our balance sheet.” He added, “The refinancing also reflects the broader strength of Asda as a diversified retail group with a robust grocery business at its core supported by an exceptional non-food offering in George and a significant presence in the high-growth convenience and food service markets following recent investments.”
This refinancing news coincides with Asda’s recent publication of its full year results for the period ending on 31st December 2023. The supermarket’s proactive approach to managing its debt and strengthening its financial position demonstrates its commitment to sustainable growth and long-term success in the retail industry.
