Bending Spoons seeks $1.5 billion in debt for acquisitions - Bloomberg

Italian technology investor Bending Spoons SpA is tapping debt markets for $1.5 billion to pursue its acquisition-led growth strategy.

The company is marketing $1 billion of five-year senior secured notes in the low 10% area and a $500 million-equivalent euro tranche in the low 9% area, according to Bloomberg, citing a person familiar with the matter. Expected ratings on the debt is BB-, toward the higher end of the junk credit spectrum.

The roughly 9% yield on the euro notes is above the 7.8% yield on the Bloomberg Pan-European High Yield Index, offering investors additional compensation for the risks of betting on Bending Spoons’ tech investments. The offering will test how far investors are willing to back that strategy at a time when leveraged-finance markets are becoming more selective.

Rising global interest rates, higher energy prices, and threats from artificial intelligence have driven a sharp increase in the cost of borrowing in Europe’s high-yield market. Bending Spoons has built its business by acquiring established software companies and overhauling their operations to boost profitability.

The company has targeted subscription app companies, using cash generated from its portfolio and debt to fund further acquisitions. Its holdings include AOL, Vimeo, Evernote, WeTransfer, Eventbrite and Airtable.