Blackstone and Permira are exploring debt financing options for Adevinta ASA, with banks and private credit lenders competing to provide up to €6.5bn ($6.8bn). 

The private equity firms aim to refinance or reprice Adevinta’s existing €4.5bn debt and may raise an additional €2bn, potentially for a shareholder dividend, according to sources familiar with the matter.

The firms acquired Adevinta in 2023 in one of Europe’s largest leveraged buyouts backed by private credit. The ongoing financing discussions reflect a shift in market dynamics, as private equity sponsors weigh whether to stick with direct lenders or turn to banks for lower-cost financing.

With M&A activity subdued, banks are aggressively pursuing deals like Adevinta’s, while dividend recapitalisations, once seen as increasing financial risk, have become more common in a slower dealmaking environment.

Several financing scenarios are under consideration. These include repricing the existing debt through Adevinta’s current private lenders, a full refinancing led by banks that would syndicate the debt to institutional investors, or a hybrid structure involving both a term-loan B facility and private credit, similar to Ardonagh Group’s refinancing last year.

Adevinta’s current debt, held by around 20 lenders, carries a 575-basis-point margin over Euribor with an original issue discount at 98. The outcome of the financing process will determine how Blackstone and Permira optimise Adevinta’s capital structure moving forward.