US investment and bank refinance for WHSmith as it prepares to offload high street shops
Retail giant WHSmith has raised £320m from US investors and via a new bank loan as it continues with plans to sell its high street stores and shift to being a global travel retailer,
The Swindon-headquartered chain today said it had successfully completion a £200m issue of US Private Placement (USPP) notes and a bank term loan of £120m.
The USPP notes, which represent WHSmith’s debut issue in the USPP market, have a maturity of seven, 10 and 12 years and have been issued on investment grade terms.
At the same time, the group, which has around 500 stores, has agreed a £120m three-year bank term loan with two uncommitted extension options of one year each.
The group said this would, subject to lender approval, extend the tenor of the new bank loan to four and five years, if exercised.
WH Smith group chief financial officer Max Izzard said: “The refinancing strengthens our balance sheet, extends our debt maturity profile and diversifies our capital structure.
“It also gives the group access to a new debt investor base in the future, and we are pleased to have the continuing support of our banking partners.”
The refinancing will diversify WHSmith’s sources of debt financing and extends its debt maturity profile in advance of the convertible bond maturing on 7 May 2026.
WH Smith said it January it was exploring potential strategic options for its UK high street outlets, saying they were a profitable and cash generative part of the group. The options include a possible sale.
WH Smith has become a global travel retailer over the past decade. The travel side of the business has more than 1,200 stores across 32 countries. Three-quarters of the group’s revenue and 85% of its trading profit come from the division.
WHSmith opened its store in London in 1792 and its first travel store at Euston station around 50 years later. The group now employs 14,000 people in 32 countries.
