Rekeep - comment

Rekeep has successfully raised €360m 2029 bonds at 9%, with the use of proceeds to take out the existing 7.25% bonds.  We had said that there would be a refinancing of these bonds in FY25 and would require c.10% coupon (albeit this is earlier than we had expected).  We are a little surprised the bonds are currently trading at par, up from the issue price of 97.5%, but bondholders have taken comfort from the tighter language in the bond offering regarding mandatory redemption at 103% following any asset disposals.  

This new deal takes us out of our 5% long position taken in 2023 at 88%.  Although mistrusted by the market, we remained confident that the bond would be refinanced this year.  

Our initial view is that 9% is a little tight for the new bond but we will evaluate the credit in the coming weeks.