Terms loans of up to £800 million have been lined up by key banks to back L1 Retail‘s acquisition of Holland & Barrett, according to Reuters.
Following last month‘s news that the health food retailer will be bought by Russian billionaire Mikhail Fridman‘s L1 investments for £1.77 billion, a huge loan has been arranged.
HSBC, UBS and Citigroup have arranged to finance the debt, denominating the loan into both sterling and euros, aiming to launch to investors before summer.
“It doesn‘t surprise me Holland & Barrett will come to the market before the summer. Given the ownership and the fact it is a new deal, it will want to tail off a hot market, rather than restart the market in September,” an investor told Reuters.
L1‘s debt size will reportedly be higher than the loan, hitting around the £1 billion mark due to the use of undrawn loans.
Holland & Barrett was bought for $3.8 billion (£2.94 billion) in 2010 by private equity firm Carlyle.
It has since grown to Europe‘s biggest health goods retailer boasting a 1300 store estate in 16 countries.