Golden Goose : Planned bond offering in connection with change of control

Golden Goose (issuer GG12 Spa) is marketing an € 880m bond offering in two tranches: 1/ at least € 350m at a fixed rate over 7NC3 years; and 2/ at least € 350m FRN over 7NC1 (par). The existing € 480m FRN 2031 bond will be called at par, as planned.
The offering is part of the financing structure for the acquisition of the group by the Chinese investment fund HongShan Capital Group (HSC), which acquires a 52% stake in the company’s share capital alongside Temasek and QIA, as minority investors.
The transaction will increase leverage by 1.5pt to 4.1x under IFRS 16 and raise the annual interest expense, which resulted in a one-notch downgrade of the group’s rating by Moody’s to B2, while S&P maintained its BB- rating.
Financial policy will be focused on deleveraging ahead of a potential IPO in two to three years, which will require maintaining sales and EBITDA growth in order to restore headroom to free cash flow following the increase in interest costs.
Price talk is 6.25%-6.5% at par, tightened from the mid-to-high 6s for the fixed rate notes, and Euribor+ 400bps with an OID in a range between 99.5 and par for the floating rate notes, tightened from Euribor+ 400bps-425bps with a 99.5 OID.