Victoria’s £300m bond issue is three times oversubscribed

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Flooring group Victoria can put its previous aborted bond issue firmly in the past after its €330m (£300m) offer was three times over-subscribed on Friday.

The stock market-listed business expects to issue the bond notes this week, which will result in it having £80m in cash.

The Kidderminster-based business wants to fix its debt until 2024 to help it maintain operational flexibility and support the company’s long-term growth strategy.

It said net proceeds will be used to repay existing bank debt and would not increase net debt.

Last November Victoria threw out plans to raise €450m (£400m) in a bond issue after it was carpeted by investors.

Shares in the floorcoverings business fell by 35% in two days last week, wiping more than £260m off its market value, after it revealed plans to refinance. It has only recovered half of that fall in the subsequent nine months.

However the successful refinancing, which is at a 5¼% fixed rate for five years, should mark the end of a difficult period for Victoria’s management.

Its commercial performance appears unaffected by any impact from last year’s public failure to refinance. Earlier this month Victoria revealed a sixth-consecutive year of growth in underlying earnings as revenues jumped 35% to £574m.

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