The Very Group - comment

The Very Group announced yesterday that it will place £598m senior secured Notes with August 2027 maturity in early June, and proceeds to call the existing bonds in August.  This is a private placement and is linked to a refinancing of the two RCF facilities.  We suspect that IMI and Carlyle are part of this transaction. The maturity of the RCF is February 2027 and the Private Placement may be extended to August 2030 on certain deleveraging and credit rating triggers. 

The Company didn’t release any numbers but guided to £300-305m for FY25 (June year-end) and £305-320m for FY26. This is £50m higher than our projections, with the outperformance driven by a reduction in distribution costs and other cost-saving initiatives. 

We took a 5% long position in mid-March and cited that an early take-out in August would equate to an 11.5% yield - even if low on a £-for-£ basis. This deal fulfils the “prophecy”.