Aroundtown Secures GBP 400 Million Bond While Pursuing Strategic Debt Restructuring Through EUR 870 Million Buyback Initiative

Aroundtown (AT1.DE) has successfully finalized the placement of a 400 million pound sterling senior unsecured bond with a seven-year maturity profile, signaling a significant milestone in the company’s broader debt optimization program. Running parallel to this issuance is an aggressive tender offer targeting approximately 870 million euros of existing bond obligations, demonstrating management’s commitment to reshaping the company’s financial architecture.

Strategic Currency Hedging and Bond Structure

The newly issued Series 44 bond carries a December 2032 maturity date and represents a key component of the company’s liability management strategy. To neutralize currency exposure inherent in pound-denominated debt, Aroundtown has employed sophisticated cross-currency hedging mechanisms, effectively converting the bond’s cash flows into euro terms. This hedging framework establishes a fixed coupon of 3.5% for the initial three-year period, with subsequent payments adjusting to a variable rate structure comprising a 1.15% spread plus six-month Euribor benchmarking.

The financial engineering behind this structure illustrates how the company is managing funding in multiple currencies while maintaining predictable financing costs. By locking in the 3.5% rate for early years, Aroundtown gains cost certainty during a critical operational phase, while the variable component thereafter provides flexibility should market rates decline.

Tender Offer Targets Higher-Cost, Near-Term Maturities

The concurrent EUR 870 million tender offer, which opened on December 4, 2025 and closes on December 11, 2025, focuses on three distinct bond series carrying relatively elevated coupon rates and nearer maturity schedules. This selective repurchase approach reveals a disciplined capital allocation strategy: by retiring shorter-dated, higher-yielding instruments, the company effectively extends its debt maturity runway while simultaneously reducing weighted-average financing costs.

The combination of issuing lower-cost, longer-duration GBP debt and simultaneously retiring expensive near-term obligations underscores a textbook liability management playbook. Market participants view such coordinated actions as evidence of prudent financial stewardship and forward-looking balance sheet management amid evolving interest rate dynamics.