Sixt issues new bond with an interest rate of 3.75 percent - financial expert analyzes

Sixt issues new bond with an interest rate of 3.75 percent - financial expert analyzes

According to a report by www.juve.de, Sixt SE has placed a bond worth over 500 million euros. The bond is part of a bond issuance program and has a term of five years. It was admitted to regulated trading on the Luxembourg Stock Exchange and bears an annual coupon of 3.75 percent.

The first-ever rating from S&P Global Rating made investors sit up and take notice, as the agency rates the listed group of companies' creditworthiness in the good range (BBB). The order book of the banking consortium, which was led by BNP Paribas, Commerzbank, Deutsche Bank and UniCredit, was more than four times oversubscribed at 2.4 billion euros.

Sixt primarily wants to use the proceeds from the bond to finance maturities in the current year and to secure long-term company growth. The company reported an 18.4 percent increase in sales in the first nine months of 2023.

The placement of the bond and the good rating from S&P Global Rating show investors' confidence in Sixt's solvency and future prospects. This will have a positive impact on the company's financing options and help support its planned expansion and long-term growth. The lower interest rates compared to the previous bond with a shorter maturity is another advantage for the company as it allows it to reduce its financing costs.

Overall, the placement of the bond will have a positive impact on Sixt and the market, as the company will be strengthened by favorable financing options and investor confidence in its creditworthiness.