A&O Shearman advises Iceland Foods on full refinancing of high yield bonds

The first transaction, completed in August, raised EUR600m through two tranches: EUR300m 6.625% senior secured notes due 2033 and EUR300m E+3.625% senior secured floating rate notes due 2033. The proceeds refinanced two existing tranches of notes due 2027 at a lower cost of debt and added cash to the balance sheet.

The second transaction, completed in October, comprised GBP250m 8.000% senior secured notes due 2031 and refinanced the company’s remaining sterling notes due 2028. As a result, Iceland now has no bond maturities before October 2031, and the maturity of its GBP75m revolving credit facility has been extended to April 2030.

The refinancings follow a period of strong performance at Iceland. Building on its heritage as an iconic UK retailer, Iceland has evolved into a diversified and international food business, with nearly 1,000 stores across the UK and around 30,000 employees. Iceland has continued to grow sales and market share, supported by its value positioning, the ongoing expansion of its Food Warehouse stores and an expanding wholesale offering.

The A&O Shearman team was led by partner John Kicken, together with senior associate Sampada Bannurmath and associates Majd Atalla and Laurens de Korte. Partner George Knighton advised on corporate matters, while partner Xinni Lim, senior associate Matthew Short and associate Sophie Hilton advised on the banking aspects of the transactions.