Retailer WHSmith has completed a major finance deal that includes funds from US investors and a bank loan. The Swindon-headquartered company confirmed on Tuesday (March 25) it had raised cash through a £200m issue of US Private Placement (USPP) notes and agreed a bank term loan of £120m.
The USPP notes, which represent WHSmith's debut issue in the USPP market, have a maturity of seven, 10 and 12 years, and have been issued on investment grade terms.
The three-year bank term loan has been agreed with two uncommitted extension options of one year each, which would extend the tenor of the new bank loan to four and five years if exercised.
The loan was provided by a syndicate of existing lenders including Fifth Third Bank National Association, HSBC º£½ÇÊÓƵ Bank, Banco Santander SA, London and Skandinaviska Enskilda Banken AB (PUBL).
Max Izzard, group chief financial officer of WHSmith, said: "We are pleased to have successfully completed our refinancing, which includes our first US Private Placement and a new bank term loan.
"The refinancing strengthens our balance sheet, extends our debt maturity profile, and diversifies our capital structure. It also gives the group access to a new debt investor base in the future, and we are pleased to have the continuing support of our banking partners."
The announcement comes as the retailer prepares to offload a number of its º£½ÇÊÓƵ high street stores as it looks to focus on more profitable outlets at airports and in train stations where footfall remains strong.
In January, WHSmith, which has been a mainstay of the high street for some 230 years, confirmed it was looking at potential divestment opportunities.
The business has a network of about 500 locations employing roughly 5,000 staff. It said at the time: "WHSmith confirms that it is exploring potential strategic options for this profitable and cash generative part of the group, including a possible sale."
The group’s travel business, meanwhile, has over 1,200 stores across 32 countries, and three-quarters of the group’s revenue and 85% of its trading profit comes from its travel arm.
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