Bending Spoons Taps Debt Market for $1.5 Billion to Fund Acquisitions

Italian technology investor Bending Spoons SpA is seeking to raise $1.5 billion from the debt markets to fuel its acquisition-led growth strategy. The offering represents a significant test of investor appetite for high-yield corporate debt amid a more selective and costly borrowing environment.

The Debt Offering

Bending Spoons is marketing a two-part deal consisting of five-year senior secured notes, according to a Bloomberg report citing a person familiar with the matter. The details of the tranches are as follows:

• A $1 billion U.S. dollar-denominated tranche being marketed with a yield in the low 10% area.
• A $500 million-equivalent euro-denominated tranche with a proposed yield in the low 9% area.

The debt is expected to receive a BB- credit rating, placing it at the higher end of the speculative-grade, or "junk," spectrum.

Market Implications

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The proposed offering comes as leveraged-finance markets contend with rising global interest rates and economic uncertainty, which have driven up borrowing costs. The yield on the euro tranche is notably above the 7.8% average yield on the Bloomberg Pan-European High Yield Index, indicating that Bending Spoons is offering investors a premium to compensate for the associated risks.

The deal's reception will serve as a key barometer for market sentiment toward financing acquisition-heavy growth strategies in the current climate. Investors have become more cautious, scrutinizing deals more closely than in recent years.

Bending Spoons' Strategy

Bending Spoons has built its business by acquiring established software companies, particularly subscription-based applications, and overhauling their operations to improve profitability. The company uses cash generated from its existing portfolio, supplemented by debt, to fund further takeovers.

Its portfolio includes several well-known technology brands, such as Evernote, Vimeo, and WeTransfer. This latest capital raise is intended to provide a war chest for future acquisitions consistent with this model.