Asmodee : We are initiating coverage of the new 2031 notes with a Neutral recommendation and the 2029 notes with a Buy recommendation

Asmodee has successfully priced its new € 320 NC2 senior secured bond issue due 2031. The bond was priced at par with a 4.25% coupon, at the lower end of the price talk range (4.25-4.5%). The IPT was initially announced at mid-high 4%. In our issuance focus published yesterday, we estimated the fair value at 4.5%, although we deemed it possible that the bond might easily attract interests slightly below this level given the very strong current earnings momentum and the conservative financial policy.
At 4.25%, the pricing is close to the average yield of a 'BB' rated issue on the secondary market (4%) vs. a B1 positive/BB-/BB- rating for the group. We are initiating coverage of the 2031 SSN with a Neutral recommendation (hold).
The 5.75% 15/12/29 notes offer a yield of 3.2% ask on the first call date (15 Dec. 2026). Exercising the call at that juncture seems credible and the one-year yield remains attractive, in line with the yields offered by single 'B' rated bonds priced on a call in 2026 (e.g. Picard, Afflelou, Mobilux). If called on the second date (15 Dec. 2027), the yield would be 3.7%. Furthermore, unlike the new 2031 notes, it does not include a release event for guarantees and collateral. We are initiating coverage of the 2029 SSN with a Buy recommendation.