HSBC takes extra security over Iceland Foods after refinancing of debt

Lender HSBC has taken additional security over some Iceland Foods’ property and various trademarks.

The move comes after a wider refinancing of its debt this month, and it includes three leaseholds and three freeholds.

The bank can, in case of insolvency, take over the assets, sell them and use the proceeds to repay the loan.

A spokesperson for Iceland said the move was a standard refinance of existing debt, and has no impact on the wider business or finance.

The frozen food chain issued another tranche of bonds worth £250m earlier this month to refinance £170m of existing bonds due in 2024 and repay £20m of debt that is due in July this year.

The deal follows a much larger £2.7bn offering by the new owners of Asda, which encountered massive demand from investors.

Iceland has access to about £180m of cash following the refinancing and net debt of more than £700m.

Richard Walker, managing director of Iceland, has defended this month the grocer’s decision to keep £40m of taxpayer support after bumper sales for the supermarket since the start of the pandemic.

He argued that the business rates relief went towards making shops Covid-secure and hiring more staff to keep up with demand for online delivery.

Walker also said the firm bought out its foreign shareholder and it needed cash for the transaction.

Supermarkets and other stores allowed to stay open during lockdown have agreed to hand back around £2bn between them.

Read More: HSBC takes extra security over Iceland Foods after refinancing of debt

2021-02-28 15:52:00

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