Vasútvill intends to issue the senior unsecured corporate bond under the Hungarian National Bank’s Bond Funding for Growth Scheme in Q4 2020, only slightly earlier than initially expected (Q1 2021). The bond will now also amortise, at 20% yearly from 2026 until maturity. The fixed annual coupon and 10-year tenor remain unchanged along with the intended uses of the bond proceeds, which include the financing of expansion plans via acquisitions of smaller players (HUF 5bn) and net working capital (HUF 3bn).

The rating case for Vasútvill’s BB-/Stable issuer rating remains unchanged, as Scope Ratings has already incorporated the bond issuance into its base case. The rating case is also backed by preliminary Q3 2020 results, which are in line with Scope’s expectations despite the Covid-19 outbreak and its impact on the economy

The recovery calculation for the initial BB- senior unsecured debt rating in July 2020 included the envisaged bond. Therefore, the rating case for senior unsecured debt also remains intact.

This publication does not constitute a credit rating action. Scope assigned a first-time rating of BB- to Vasútvill Kft. on 7 July 2020. For the official credit rating action release click here.