Vivion - comment

Marginally good for the bonds this morning. Vivion has announced the acquisition of the St. Martins Lane hotel in the context of a new €87m refinancing. The acquisition comes at a €27m discount to a previous sale and leaseback deal carried at €69m in Dec '25, which has now been extinguished for a €42m cash payment. The sale-and-leaseback was completed on 2 February 2021. Vivion retained a 200-year lease with a buyback option at the end for £1 and lease payments of £1.2m per annum. The transaction raised net proceeds of ca. £ 50m, and Vivion described it at the time as "attractive alternative financing with a cost of debt of approximately 2%.". So the structure sat on the balance sheet for just over four and a half years before being unwound. What is notable is the economics: Vivion raised it in 2021 at ca. 2%, carried the liability at £60m and bought it back in August 2026 for £36m (€42m). The £24m discount to the carrying value is essentially the movement in present value of the 200-year lease tail in that period. The buyback at £36m against a £60m liability marks a favourable exit for Vivion.