KKR-Coty deal to be financed by record US$1.3 billion club loan

KKR-Coty deal to be financed by record US$1.3 billion club loan

THE WHAT? KKR’s purchase of a majority stake in Coty will be financed by a US$1.3 billion club loan, the largest in Europe’s leveraged debt market since la crise, according to a report published by Reuters.

THE DETAILS KKR agreed to buy some 60 percent of Coty’s Professional Beauty and Retail Hair businesses, comprising Wella, Clairol, OPI and Ghd, at the start of May but with a lower appetite for risk generally, the underwriting market has almost ceased to exist.

Instead, KKR has opted to raise a club loan, due to close in June, with the exposure held on balance sheet.  

THE WHY? Banks were reluctant to underwrite KKR’s planned financing due to the COVID-19 pandemic, says Reuters.

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