US alternatives giant leads £150m refinancing at debt-laden Very
The credit giant that took control of Very from the Barclay family has arranged a £150m funding package for the online retailer ahead of a potential £2bn sale.
Carlyle helped arrange an extension and renewal of debt-laden Very’s key credit lines, in a move it said helps secure the group’s long-term funding until 2029.
The deal also converted millions of pounds of credit into equity in an attempt to reduce pressure on the group from interest payments. The changes were completed with a lower interest rate than the previous credit structuring, Very said.
Carlyle seized control of Very Group, which owns Littlewood and Very, in November, as part of the high-profile break-up of the Barclay family’s sprawling business empire. The Barclay family had owned the business for two decades, with Carlyle acting as one of its largest lenders.
At the time, Carlyle said the transaction would help provide the online retailer with a “strengthened capital base and enhanced flexibility”, and promised to increase “investment in technology and customer experience”.
Very put up for sale
But months after taking the reins at Very, the alternatives juggernaut launched a sale process through which it hopes to fetch a £2bn valuation. Dealmakers appointed Barclays and JP Morgan to handle the auction of Very, which generates over £2bn in revenue and is chaired by Nadhim Zahawi, the Reform UK politician who founded the YouGov polling company.
New York-listed Carlyle, whose other European investments include trading platform Calastone and designer trainer brand Golden Goose, has helped prop up Very through a succession of loans since the pandemic.
In 2021 it injected hundreds of millions of pounds into Very’s coffers to help carry it through the coronavirus, and three years later it provided another £85m. The injections ultimately paved the way for the buyout giant to take control of the group last year, when swathes of the Barclay family’s vast business empire was broken up.
Unpaid debt, in excess of £1bn, sparked the family to hand over several of their flagship assets, including The Telegraph and Ritz Hotel to lenders.
“Securing this long-term funding reflects the confidence of our lenders in the strength of our business,” said Edward Fry, chief financial officer at The Very Group.
“The combination of extended maturities, improved margins and further deleveraging provides a stable platform for continued investment in our digital and customer proposition, while maintaining a disciplined approach to balance sheet management.