By Lisa Johnston
New products on display at the American International Toy Fair, held in N
Fort Worth, Texas – RadioShack has secured $835 million in new financing.
The credit line includes $585 million from GE Capital and other backers, and a $250 million term loan led by Salus Capital Partners.
The retailer said it will use the funds to refinance existing debt and add about $200 million in liquidity. The moves will further strengthen the company’s balance sheets as it moves forward with CEO Joe Magnacca’s turnaround strategy.
“In July, we outlined the five pillars of our turnaround plan: reposition the brand, revamp the product assortment, reinvigorate the store experience, operational efficiency and financial flexibility,” Magnacca said. “This new financing fulfills the last pillar and provides the financial flexibility and ample runway to turn this business around.”
He added that with the new financing in place and the progress made to date, the chain is now “focused on delivering a great RadioShack experience for the millions of our customers who choose to shop with us this holiday season.”
The company said it has since exited an existing $450 million credit facility and two “accordion” loans totaling $75 million, and has retired an existing $100 million second lien term loan. With the new financing and an existing $325 million of 6.75 percent unsecured notes due in 2019, RadioShack now has approximately $625 million dollars of debt outstanding.
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