Luxury conglomerate Kering has managed to raise an impressive €1.5 billion through a recent bond issue, showcasing its strong growth despite the ongoing pandemic. The company experienced a remarkable 27% increase in revenue during the first quarter of 2022, reaching a total of €4.956 billion. This outstanding performance has solidified Kering’s position in the market, highlighting its resilience and ability to navigate uncertain environments.
The bond issue was a crucial part of Kering’s strategy to finance its acquisition of eyewear brand Maui Jim. The bond was divided into two tranches, each worth €750 million. The first tranche holds a three-year bond with a 1.25% coupon rate, while the second tranche boasts an eight-year bond with a 1.875% coupon rate. This move allows Kering to enhance its funding flexibility by refinancing existing debt and partially funding the Maui Jim acquisition.
In March, Kering Eyewear, a subsidiary specializing in eyewear, announced the acquisition of Maui Jim. This came after the luxury group’s acquisition of Danish brand Lindberg in July 2021. Maui Jim is renowned as the world’s largest independently owned high-end eyewear brand, particularly in North America. Although the financial specifics of the transaction have not been disclosed, it undoubtedly adds to Kering’s expanding portfolio in the eyewear industry.
The success of the bond issue further solidifies Kering’s credit quality, reflecting the market’s confidence in the group. The company holds a long-term debt rating of ‘A’ with a stable outlook, as assessed by Standard & Poor’s. This bond issue not only supports the acquisition of Maui Jim but also paves the way for potential future acquisitions by the luxury conglomerate.
Overall, Kering’s impressive performance in the face of challenging circumstances highlights its commitment to strategic growth in the luxury industry. With its successful bond issue and expansion into the eyewear market, Kering continues to demonstrate its resilience and ability to prosper in the evolving luxury landscape.
Useful Links:
1. Kering Finance Page
2. Competition and Markets Authority (CMA) – Official website
