Impact on bond yield from the UK government’s measures:
The value of the bonds issued by the companies in the restaurant and entertainment business in the UK has lost the flicker after the new restrictions imposed by the UK government.
The government has taken new measures to curb coronavirus cases such as staff and customers at the hospitality venues are required to wear face masks unless they are seated at the table to eat or drink. The restaurants and entertainment centers would remain close between 10 pm and 5 am, and the gathering at outdoor events was limited to six. These measures have taken a toll on the already struggling outdoor eating sector and entertainment sector.
In July 2020, the Stonegate Pub issued bonds worth £950 million due to mature in 2025 at 8.25% and €350 million floating-rate bonds. The bonds were issued for the takeover of Ei, one of the competitors. However, due to the turbulence in the restaurant business and recent measures imposed by the government, the liquidity gap is widening, and that can add to the risks for investors seeking higher yields.