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PAI Partners Taps High-Yield Debt Demand to Fund R&R Buyout

PAI Partners is taking advantage of demand for high-yield bonds to fund its acquisition of R&R Ice Cream Plc with a type of securities that allow the borrower to pay interest with more debt.

R&R Ice Cream is raising so-called payment-in-kind toggle notes to help fund the 460 million-euro buyout deal, according to statements on the company’s website. The PIK notes may total 253 million euros ($330 million), data compiled by Bloomberg show. It’s also seeking permission from bond holders to complete the buyout without triggering clauses forcing early repayment of the notes, it said.