Asda has completed a refinancing of £3.2bn of its debt, which the supermarket said will push the “majority of its maturities into the next decade”.


The deal included the biggest sterling high-yield bond this year as well as the second-largest sterling bond in the European leveraged finance market – only behind Asda’s first £2.25bn sterling bond tranche in 2021.

The supermarket added that “strong investor demand” meant it could raise £1.75bn of senior secured notes and “upsize by more than £200m on a £900m Equivalent EUR Term Loan B (TLB) bringing the final size to £1.1bn equivalent”.

For the new senior secured notes and TLB, the maturities are 2030 and 2031 respectively. Asda said it also used around £300m of its balance sheet to reduce gross debt as part of the refinancing.

Asda has extended the maturity of its revolving credit facility from August 2025 to October 2028 and was able to upsize this facility from £667m to £748m in connection with the wider refinancing.

In a statement, Asda said: ”The refinancing follows a recent upgrade in Asda’s corporate rating from Moody’s to B1 from B2, while Fitch Ratings raised their outlook on Asda’s Long-Term IDR to positive from stable and affirmed the IDR rating at B+ and S&P Global Ratings assigned a B+ long-term issuer rating with a stable outlook.”

The news of refinancing comes after Asda announced underlying profit of more than £1bn and like-for-like sales rising 5.4% in the 2023 financial year.

Asda chief financial officer Michael Gleeson said: “We saw strong demand from investors after taking a thoughtful and prudent approach to refinancing our near-term debt well ahead of maturities – to further strengthen our balance sheet.

“The positive reaction followed Asda’s strong FY23 results – and Moody’s upgrade of its corporate rating to B1 from B2 last week citing a material reduction in leverage and growth in underlying free cashflow.

“The refinancing also reflects the wider strength of Asda as a diversified retail group with a strong grocery business at its core supported by a fantastic non-food offering in George and following recent investments, a major presence in the high-growth convenience and food-service markets.”