Retailer rue21 Announces Deal With Bank of America To Retire Debt, Extend Credit Agreement
WARRENDALE, Pa., Dec. 16, 2020 /PRNewswire/ -- Specialty retailer rue21 (r21 Holdings, Inc.) announced today that its strong financial position has enabled it to refinance its existing term loan, increase available liquidity and lower its cost of capital. rue21 amended its asset based credit facility to increase availability to $155mm due 2025 led by Bank of America, N.A. The amendment includes an increase to the FILO loan through a joint partnership with Bank of America and Tiger Finance. As of today, total liquidity exceeds $100 million. The new capital structure will allow it to accelerate strategic growth initiatives, including omni-channel enhancements to create more engaging customer experiences.
“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,” said Michele Pascoe, rue21′s Chief Financial Officer, noting that the retailer continues to outperform expectations with comparable sales exceeding last year’s results. “I want to thank Bank of America and Tiger Finance for recognizing our focus on working capital productivity and gross margin expansion, and for providing us with the opportunity to emerge from a post-pandemic world in a position to accelerate rue21′s growth. We have worked with both Bank of America and Tiger for many years, and view them both as valued financial partners.”
With nearly 700 stores in 45 states, the ‘trend right’, affordable fashion retailer is one of the few specialty retailers with a positive story. Post pandemic, rue21′s business is significantly outperforming the apparel market trends. The company recently launched rue rewards, its loyalty rewards program, that has already achieved over 2.8 million members. In addition, the retailer recently opened three new brick-and-mortar stores with another 15 planned for next year. Last month, the company appointed experiential retail transformer and former HSN President, Bill Brand, as its chief executive officer.
“I’m thrilled to join rue21 at such a great time in their history,” said Brand. “Today’s announcement is a testament to the leadership of the CFO and the entire executive team in executing our operating strategy and putting us in the enviable position of investing in building the rue21 brand, new digital capabilities and opening more new stores.”
“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. In addition, our reduced debt load signals our financial strength to vendor and landlord partners.” commented Ms. Pascoe.
rue21 is a fashion destination that promises to give customers quality styles at accessible prices. They offer the largest selection of products, sizes and trends that fit every personality and budget. Headquartered just north of Pittsburgh, Pennsylvania in Warrendale, they operate over 673 stores in 45 states and online at www.rue21.com.
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