Relais' hybrid bond issue proceeding as expected
Summary
- We assess the hybrid bond issue by Relais as a successful financing solution, with the company raising slightly more capital than expected, amounting to 50 MEUR.
- The fixed interest rate for the bond is set at 7.875% for the next four years, aligning with our anticipated range of 7-8%, and will float thereafter.
- In our view, the issuance provides Relais with greater financial flexibility for acquisitions and reduces net debt more than initially forecasted, though it will decrease earnings per share estimates by 5-10% due to its higher interest rate compared to bank loans.
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Translation: Original published in Finnish on 9/19/2025 at 8:28 am EEST.
While the cost of financing through the issue is in line with our expectations, the company is raising slightly more capital through it than expected. Overall, we consider the financing package a successful solution for the company in its current situation.
Hybrid bond amounts to 50 MEUR
Relais announced on Thursday that it is issuing perpetual hybrid capital securities with a nominal amount of 50 MEUR. The fixed interest rate for the bond was set at 7.875% for the next four years, after which the interest rate will float as defined in the terms and conditions of the capital securities. The capital securities do not have a specified maturity date, however, Relais is entitled to redeem the capital securities on the reset date or on any subsequent interest payment date, among others. The issue date for the capital securities will be September 25, 2025.
Cost of financing settled at the level we anticipated
The issuance of the hybrid bond is driven by the company's need to refinance a previous bridge loan taken out in connection with an acquisition. We had previously estimated the interest rate on the hybrid bond to be in the 7-8% range, so the outcome is consistent with our expectations in this regard as well (our comment can be read here). The final loan amount is slightly higher than the company forecasted, which will reduce the company's net debt a little more than previously expected. This also gives the company slightly more leeway to make acquisitions than anticipated. Overall, we consider the financing solution achieved to be a successful arrangement in the company's current situation.
Our forecast did not include assumptions about raising equity financing but instead assumed that debt financing would consist purely of bank loans. We will incorporate the now-announced financing package into our estimates in the near future. Due to its higher interest rate compared to bank loans, the hybrid bond, which is classified as equity financing, will decrease our earnings per share estimates for the coming years by 5-10%, according to our preliminary assessment.
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Relais Group is an importer and wholesaler for the automotive industry. The group focuses mainly on the development of automotive electronic equipment for trucks. Examples of products that the company supplies include lighting products, applications for warning lights, camera systems, and other spare parts for heavy vehicles. The largest operations are found in the Nordic and Baltic markets, with customers in the aftermarket industry.
Read more on company pageKey Estimate Figures14.08.
| 2024 | 25e | 26e | |
|---|---|---|---|
| Revenue | 322.6 | 382.2 | 440.8 |
| growth-% | 13.5 % | 18.5 % | 15.3 % |
| EBIT (adj.) | 36.1 | 38.9 | 45.6 |
| EBIT-% (adj.) | 11.2 % | 10.2 % | 10.3 % |
| EPS (adj.) | 1.21 | 1.29 | 1.57 |
| Dividend | 0.50 | 0.52 | 0.55 |
| Dividend % | 3.7 % | 3.1 % | 3.3 % |
| P/E (adj.) | 11.4 | 12.9 | 10.7 |
| EV/EBITDA | 7.5 | 9.1 | 7.8 |
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