Indianapolis – hhgregg is looking to
raise upward of $54 million through a public stock offering to help fuel the
chain’s aggressive expansion plans.
The company, which plans to enter the Mid-Atlantic States next
year with as many as 45 new stores, is selling 3 million shares of its common
stock, which closed yesterday at $16.89 on the New York Stock exchange.
The offering, expected to raise between $46.7 million and $53.8
million, comes as the company’s estimated first-quarter comps fell nearly 15
percent on weakness in the video and appliance categories.
In addition to the public offering, hhgregg will sell another 1
million shares at the public price to an investment fund controlled by Freeman Spogli & Co., a majority
shareholder that acquired the retailer in 2005 and helped take it public two
years later. The private investment firm currently holds 37.6 percent of hhgregg’s
outstanding common stock, although its position would be reduced to 36.3 percent
following the public offering.
The chain has
also increased its credit line, from $100 million, to $125 million, according
to a filing with the Securities and Exchange Commission.
As part of the private placement with Freeman Spogli, hhgregg disclosed its preliminary
results for its first fiscal quarter. Estimated net sales slipped 3.7 percent
to $284.4 million for the three months, ended June 30, driven primarily by an
estimated 14.7 percent decrease in comp-store sales, as video and appliance comps
fell by 17 percent and 17.5 percent, respectively.
decline was offset by the opening of 15 stores since the year-ago period, the
hhgregg will open
two more stores today, in Asheville and Wilmington, N.C., bringing its store count
- 2019 TWICE Top 100: Watch List - May 23, 2019
- 2019 TWICE Top 100: Consumer-Direct Sales Dominate The Charts - May 22, 2019
- 2019 TWICE Top 100: Best Buy Keeps The CE Crown, But Barely - May 21, 2019