Nordstrom's New Credit Facility - Analyst Blog
June 24 2011 - 12:50PM
Zacks
One of the leading fashion specialty retailers in the U.S.,
Nordstrom Inc. (JWN) has entered into a new
five-year unsecured revolving credit agreement with a consortium of
world's leading investment bankers for optimizing its capital
structure.
Bank of America Merrill Lynch Wells Fargo Securities, LLC are
offering the total amount of $600.0 million to the new revolving
credit line facility maturing in June 2016. The company would have
to pay an interest of LIBOR plus a margin of 1.125% on the
outstanding amount and a commitment fee of 0.125% on the total
capacity. The new credit facility will replace the company's prior
unsecured revolving credit facility of $650.0 million, which was
schedule to mature in August 2012.
Under a revolving credit facility, a company can borrow again
once it repays all dues under the old credit facility. The company
may utilize this fund for general corporate purposes, which
includes repayment of outstanding commercial papers, working
capital and capital investment or acquisitions.
Nordstrom has also notified that it has terminated the $650.0
million credit facility entered on August 14, 2009, effective from
June 23, 2011, as there were no outstanding borrowings under the
credit facility. Under this credit facility, the company has paid a
variable rate of interest of LIBOR plus a margin of 1.750% on the
outstanding balance and a commitment fee of 0.250% on the total
capacity.
Based in Seattle, Washington, Nordstrom is a leading fashion
specialty retailer in the U.S., offering high quality apparel,
shoes, cosmetics and accessories for men, women and kids. The
company offers both branded and private label merchandise, as well
as a private label card, two Nordstrom VISA credit cards and debit
cards to be purchased from Nordstrom stores.
The company operates in a highly fragmented specialty retail
sector and faces intense competition from other well-established
players, such as Gap Inc. (GPS) and
Abercrombie & Fitch (ANF).
Nordstrom currently holds Zacks #3 Rank, implying a short-term
Hold rating. We retain our long-term Neutral recommendation on the
company.
ABERCROMBIE (ANF): Free Stock Analysis Report
GAP INC (GPS): Free Stock Analysis Report
NORDSTROM INC (JWN): Free Stock Analysis Report
Zacks Investment Research
Abercrombie and Fitch (NYSE:ANF)
Historical Stock Chart
From Jun 2024 to Jul 2024
Abercrombie and Fitch (NYSE:ANF)
Historical Stock Chart
From Jul 2023 to Jul 2024