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Car rental company raises 300 million euros – via loan

The car rental company Sixt collects money on the capital market with a corporate bond. The company could also repay government loans.

The car rental company has raised 300 million euros on the capital market with a bond. The paper runs for four years and has a coupon of 1.75 percent.

A bond is a type of credit companies or even states grant investors. In return, they are paid interest – like banks with a regular loan. In contrast to a share, a group does not sell a company share with a bond.

With the money from the bond, Sixt wants to secure its long-term corporate financing and finance its operational business. The company also has the option of reducing a credit line of up to 1.4 billion euros from the state development bank KfW and several commercial banks. “The placement enables the company to redeem parts of it if we want,” said Chief Strategy Officer Alexander Sixt in response to a Reuters request. “However, this depends largely on how growth will look in the coming year.”

The company also wants to make the bond attractive to private investors by denominating it in notes of 1,000 euros each – in this case, private investors would lend the company money. BayernLB, Commerzbank, Deutsche Bank, J.P. Morgan and UniCredit.

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