Stagecoach opts for early bond repayment at a cost of £23m

The move comes after the business recently managed to secure cheaper finance and only a month after the bonds were issued.

Stagecoach issued £400m of new bonds with a coupon of four per cent at the end of September and said the issue had attracted “high quality” investors.

Now the group has said its £400m of guaranteed bonds with a 5.75 per cent coupon will be redeemed in full on October 30 at the redemption price with interest and the listing of the bonds cancelled from November 17.

It said the premium payable for early termination would be about £23m, which would be taken as an exceptional item in the six months to October 31.

Finance director Ross Paterson said the group had decided to proceed after reviewing its options.

Shares were up 8.1p to 340.1p.