Fashion Retailer rue21 Strikes Deal To Retire Debt

Fashion retailer rue21 (r21 Holdings, Inc.) said that its formidable financial standing enabled it to refinance its current term loan, decrease the cost of funds and bolster available liquidity, according to an announcement.

"Today is an exciting day, as we've accomplished our goal of putting rue21 on a secure financial footing in the most unprecedented of times," rue21 Chief Financial Officer Michele Pascoe said in an announcement.

The retailer modified its asset-based credit facility to bolster availability to $155 million due 2025 headed up by Bank of America, N.A. The modification comes with a rise to the FILO Loan via a collaborative effort between Tiger Finance and Bank of America.

"Bank of America and Tiger Finance will help provide rue21 with the working capital capacity to support our growth objectives and to continue to provide our loyal customers with a superb omnichannel shopping experience,” Pascoe said.

She also added that the company’s decreased debt load shows its financial formidability to supplier and landlord partners.

rue21 says the new capital framework will let it speed up strategic expansion efforts, such as omnichannel improvements, to allow for more engaging client experiences.

The company recently rolled out a loyalty rewards initiative called rue rewards that has garnered more than 2.8 million members. The retailer also opened three new physical retail shops, with another 15 in the works for 2021. And in November, the company appointed past HSN President Bill Brand to the position of CEO.

Pennsylvania-based rue21 runs more than 673 retail locations in 45 states and online at rue21.com.

Separately, in April, news surfaced that Office Depot refinanced its asset-based credit facility with a new five-year deal and had retired its term loan credit agreement due in 2022. The merchant’s new $1.3 billion asset-based credit facility was composed of a $1.2 billion revolving credit facility along with a $100 million FILO facility.