Investors that believe there are two certainties in life, death and taxes, might want to look at a property sales process kick-started by one of Britain’s largest funeral operators.

Dignity is planning to sell at least £70M of property assets to pay down debt, according to a proposal sent to bondholders.

The company operates 800 funeral homes and 46 crematoria across the UK, some of which it owns freehold, and some of which it leases.

It has a £171M loan against some of the assets it owns that was securitised, with the debt sold to bondholders.

Dignity said it wants to sell some of the assets within that securitisation —and some that are outside of it — to pay down at least £70M of debt. It needs the consent of bondholders to sell the properties.

The sale will definitely include seven crematoria, Dignity said, which generate earnings for the company of £6.7M a year before interest, tax, depreciation and amortisation. It could lease the assets back after the sale.

The loan has already been restructured once, earlier this year, because as the coronavirus pandemic recedes, the death rate might fall below long-term averages.

“Higher death rates during the pandemic in 2020 and 2021 have contributed to Dignity’s securitisation’s relatively stable performance despite lower revenue per funeral and cremation — caused by the various pandemic-related government restrictions,” Fitch said in a note on the covenant amendments.

“The large number of excess deaths during this period means that some deaths have been brought forward. Depending on the development of the pandemic, and as the effect of excess death rates fades, lower death rates may occur in subsequent years.”

Fitch said Dignity had lost market share in the years leading up to the pandemic because its prices had risen. Dignity has introduced a new, low-cost funeral offering in hopes of regaining market share, but cutting prices in a period of falling death rates might hit profitability, Fitch said.