TalkTalk's strained balance sheet has already sparked concerns. Last year, lenders imposed stricter covenants and auditors issued a warning about its accounting. Now, the company is gearing up for refinancing. TalkTalk has a £330m revolving credit facility that matures next November and £685m worth of debt maturing in February 2025. The recent surge in interest rates means the company faces higher borrowing costs. In April, yields on TalkTalk's bonds surged to around 20pc. While they have since fallen back to just under 15pc, that remains at distressed levels, according to analysts. New Street Research analyst James Ratzer wrote earlier this month: "At current refinancing rates, we struggle to see debt coming down in absolute terms without further disposals or a further equity injection." As a result, TalkTalk has found itself with no choice but to break up the business.