Tuesday 17 November 2009 7:00 pm

M&S launches first ever bond buy-back plan

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MARKS and Spencer yesterday announced it would be embarking on its first tender offer to shareholders in its 125-year history.

The retail bellwether said it plans to buy back up to £225m of bonds from investors and issue new debt, becoming the latest firm to take advantage of attractive market conditions.

The clothing, homewares and food retailer has invited holders of its outstanding £375m 6.375 per cent notes due 2011, and holders of its outstanding £400m 5.875 per cent notes due 2012 to participate in a tender offer on November 24.

M&S said the buyback was subject to it raising new sterling-denominated bond financing on satisfactory terms.

The group said: “The purpose of the invitation and the company’s contemplated raising of new financing is to take advantage of current favourable market conditions in the debt capital markets and to extend the company’s debt maturity profile.”

A spokeswoman for M&S said the firm was seeking debt maturity beyond 2014. Citigroup, HSBC, Morgan Stanley and Royal Bank of Scotland are acting as dealer managers for the tender offer.