COTY- New Issue Comment

Coty recently issued senior unsecured notes split into $550m 6.5% 8Y, €550m 4% 5Y, and €250m 4.75% 8Y tranches. Along with $6bn equivalent of new term loans and a new RCF, which are all senior secured instruments, proceeds will be used to refinance all existing debt, including the former P&G beauty debt assumed as part of the merger. Proforma net reported leverage is unchanged at 4.2x for covenant purposes, including the substantial $521m synergies expected by management. However, we calculate a...