Credit rating agency Moody's is very concerned because Hema has postponed a repayment to parent company AMEH XXVI. The Dutch chain's total debt, some 750 million euros, and the dismissal of CFO Ivo Vliegen, are also a cause for concern for Moody’s.
The loan in question is a result of Hema's takeover. Last year, the chain's new owner, Marcel Boekhoorn, converted most of it into shares, leaving 40 million. It was agreed that this was to be reimbursed by the end of 2019, but this has not happened. For Moody's, the postponement is seen as negative in respect of the creditworthiness of the home furnishing chain.
Hema's entire mountain of debt, however, is much larger than that one loan: the total is around 750 million euros, a debt that is hanging over Hema like the Sword of Damocles. If the 40 million loan is not repaid by June 2020, the retail chain will have to pay all of its outstanding debts at once.
To make matters worse, yesterday it was also announced that CFO Ivo Vliegen is leaving Hema. He is to be replaced by Joost de Beijer. In terms of the company's credit rating, Moody's also rated this change as negative. "It increases uncertainty about the company’s future financial policy and how the company is to repay its debts", Retailtrends quotes analyst Francesco Bozzano.