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Supermarket chain Jumbo has collected new funds in Germany. The company aimed for one hundred million but collected twice as much with a so-called “Schuldschein”, a type of private loan under German law.
Staggering growth rate
Jumbo is currently growing at a staggering rate, and that requires a lot of money. But the group wanted to reduce its dependence on large Dutch banks and went looking for other funding sources.
That’s how the company arrived at the Schuldschein, an inherently German loan that has gained a lot of popularity among international companies in recent years. This has everything to do with the more flexible rules that apply to this type of loan. For example, in contrast to a classic bond, there are fewer requirements regarding providing information. Also, the procedure is much faster. Small investors are unable to obtain them: Schuldschein loans are exclusively available to a professional audience of pension funds, banks and insurers.
Schuldschein loans can also be better tailored to the company. The terms and interest rates are far more flexible. But still, according to IFRS accounting standards, these loans can be booked as credits and not as investments, so there is no obligation to constantly check the value of this loan against the market value. Nothing but benefits, so to speak.
A rush among investors
The Jumbo loans, with terms of five and seven years, were stormed by investors: the interest was four times higher than the offer, so Jumbo chose to double the amount of the initial target. According to information from Dutch newspaper De Telegraaf, a quarter of the money came from Benelux customers, 55 per cent from other European countries and about a fifth of the loan was placed with Asian investors.
Of course, this result generates nothing but satisfaction at Jumbo. “We are delighted with this interest, and with the placement of this Schuldschein loan, we are strengthening our financial basis for further growth”, says Jumbo’s financial director Ton van Veen in De Telegraaf.
