CBR Fashion - New Issue Comment
CBR Fashion (‘CBR’), the German apparel wholesaler in the mid-price segment, has launched the issuance of €450m 5NC2 senior secured notes. Proceeds will be used to repay the existing bank debt. The issue ratings are B/B2, the same as the corporate ratings.
CBR Fashion has an unusually high focus on wholesale (80% of sales; a large footprint of points of sale), which supports higher margins compared to peers, low working capital and strong cash generation. The cost structure is also more flexible, which we see as a positive in the cyclical and highly competitive apparel market. CBR benefits from a fast production process from design to sale (10-14 weeks) and very frequent new collections (12 a year for each brand - Street One and CECIL), supporting traffic into stores and reducing fashion risk.
Spread Research is France's first Rating Agency, registered by ESMA (European Securities and Markets Authority) and a leading European Independent Credit Research firm, founded in 2004 and based in Lyon, France. Our experienced team offer key research services using a wide range of investment strategies and research methodologies for the High Yield, Emerging Markets, Convertibles and Loan Markets.
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