Key Takeaways
- • Lone Star Funds is evaluating strategic alternatives for Evoca, including debt-for-equity restructuring with creditors Carlyle and Park Square or an outright sale of the Italian coffee-machine manufacturer.
- • Evoca faces a debt load exceeding €950 million across two tranches: €400 million in payment-in-kind notes (maturing 2029) and €550 million in operating company bonds quoted at 89 cents on the euro as of September 23, 2026.
- • The company's financial deterioration triggered a one-notch credit downgrade to B- by Fitch in June 2026, driven by a 16% revenue decline in 2025 and a debt-to-earnings ratio of 8.2 times.
- • Preliminary creditor discussions have not yet produced an agreement on debt conversion, with PJT Partners advising Evoca on its strategic options.
- • Recent operational momentum provides a modest counterweight to distress signals: second-quarter 2026 revenue rose 14% year-over-year, suggesting the company's cost-reduction program may be gaining traction.
Summary
Lone Star Funds is actively exploring restructuring options for Evoca, its Italian coffee-machine manufacturer, amid mounting financial pressure and elevated leverage. According to Bloomberg, the private equity firm has initiated preliminary discussions with major creditors Carlyle and Park Square about converting their debt holdings into equity stakes, though negotiations have not yet reached agreement. A sale of the asset remains under consideration as an alternative path. PJT Partners has been retained to advise on the full range of strategic options available to the company.
The debt burden constraining Evoca reflects both its current operating challenges and the structure of its past acquisition. A holding company borrowed €210 million in payment-in-kind notes from Carlyle and Park Square in 2019; that debt has since accumulated to more than €400 million through accruing interest. Additionally, the operating company carries €550 million in bonds maturing in 2029, which were trading at approximately 89 cents on the euro as of September 23, reflecting significant credit stress. Combined, Evoca's debt obligations exceed €950 million.
The company's financial performance has deteriorated materially. Fitch downgraded Evoca's credit rating by one notch to B- in June 2026, citing a 16% revenue contraction in 2025—substantially worse than the rating agency had previously anticipated. The company's leverage metrics have expanded accordingly, with debt-to-earnings reaching 8.2 times at year-end 2025, well into distressed territory. The downgrade leaves Evoca firmly positioned in high-yield credit markets, signaling elevated default risk in creditors' assessments.
However, operational momentum has improved materially in recent months. Second-quarter 2026 results demonstrated recovery, with revenue rising 14% year-over-year in the three months ending June 30. This turnaround appears attributable to Evoca's cost-reduction initiatives, which have begun to stabilize margins after a weak first quarter. The business manufactures coffee machines widely deployed across hotels, cafes, and office environments, positioning it in an established but competitive market segment.
The restructuring or sale decision will likely hinge on whether Evoca's operational improvement trajectory proves durable. A debt-for-equity conversion would dilute Lone Star's ownership but preserve enterprise value for the business as a going concern. Conversely, a sale would transfer the turnaround risk to a new owner while providing liquidity to Lone Star and potentially allowing creditors to realize value through transaction proceeds. Neither Evoca, Lone Star, nor PJT Partners has commented on the discussions or timeline for a decision.
The debt burden constraining Evoca reflects both its current operating challenges and the structure of its past acquisition. A holding company borrowed €210 million in payment-in-kind notes from Carlyle and Park Square in 2019; that debt has since accumulated to more than €400 million through accruing interest. Additionally, the operating company carries €550 million in bonds maturing in 2029, which were trading at approximately 89 cents on the euro as of September 23, reflecting significant credit stress. Combined, Evoca's debt obligations exceed €950 million.
The company's financial performance has deteriorated materially. Fitch downgraded Evoca's credit rating by one notch to B- in June 2026, citing a 16% revenue contraction in 2025—substantially worse than the rating agency had previously anticipated. The company's leverage metrics have expanded accordingly, with debt-to-earnings reaching 8.2 times at year-end 2025, well into distressed territory. The downgrade leaves Evoca firmly positioned in high-yield credit markets, signaling elevated default risk in creditors' assessments.
However, operational momentum has improved materially in recent months. Second-quarter 2026 results demonstrated recovery, with revenue rising 14% year-over-year in the three months ending June 30. This turnaround appears attributable to Evoca's cost-reduction initiatives, which have begun to stabilize margins after a weak first quarter. The business manufactures coffee machines widely deployed across hotels, cafes, and office environments, positioning it in an established but competitive market segment.
The restructuring or sale decision will likely hinge on whether Evoca's operational improvement trajectory proves durable. A debt-for-equity conversion would dilute Lone Star's ownership but preserve enterprise value for the business as a going concern. Conversely, a sale would transfer the turnaround risk to a new owner while providing liquidity to Lone Star and potentially allowing creditors to realize value through transaction proceeds. Neither Evoca, Lone Star, nor PJT Partners has commented on the discussions or timeline for a decision.
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