German beauty retailer Kirk Beauty One GmbH recently announced the acquisition of the Italian beauty retailers Limoni and LaGardenia, following the announcement of the acquisition of the Spanish beauty retailer Bodybell in March 2017. Kirk Beauty intends to issue a new €300 million facility under its existing €1,370 million term loan B to fund the acquisitions at a 3.25% margin; simultaneously, the remaining term loan B is to be repriced to 3.5% from 3.75% previously. We estimate that, following the transaction, Kirk Beauty will generate positive free operating cash flow (FOCF) and expand its earnings such that its weighted-average credit metrics remain broadly comparable with the level we had expected previously. We are therefore affirming our 'B' long-rating on Kirk
