Toys R Us is trying to raise $1.38 billion in new financing to replace bonds that are coming due in the next few years, according to a regulatory filing as reported by Bloomberg. The company is trying to raise $1.025 billion of term loans due in five and a half years and a $350 million bank loan that will mature in five years, which will replace term loans and notes due in 2016 and loans maturing in 2018. It would pay a premium to redeem its existing bonds earlier, and said in the filing that it expects that its interest cost would increase.
A group of bondholders has been pressing for a refinancing to avoid a near term liquidity problem; lobbying for some bondholders to accept a change in terms to permit it (see “Toys R Us Finishes Clearing Inventory”).
The company’s debt is considered well below investment grade, and was downgraded after the company reported losing $1 billion last year (see “Toys R Us Loses $1 Billion”).
Of $1.4 Billion
Posted by ICv2 on September 30, 2014 @ 2:47 am CT
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