The Children’s Place mulls 130 million dollar term loan

The Children’s Place has announced that it has received an offer for a 130 million dollar term loan from a subsidiary of liquidation and restructuring firm Gorden Brothers, days after over half of its share capital was snapped by Mithaq Capital.

While the offer by Gorden Brothers is still subject to due diligence checks, The Children’s Place said that it had been seeking to “improve its liquidity position and strengthen its balance sheet to best position the company for the future”.

As such, it had been working with advisors to identify potential lenders and therefore secure new financing to support its operations and amend the provisions of existing credit facilities, including a 50 million dollar term loan under a credit agreement dated May 9. 2019.

The news of the term loan came days after Saudi Arabia’s Mithaq, the investment firm of the AlRajhi family, secured a 54 percent stake in the company, making it a majority shareholder and triggering a change of control over the aforementioned credit agreement.

The Children’s Place said that it intended to accept the firm’s “request to enter into discussions regarding the provision of financing” to assist with liquidity needs.

Meanwhile, with Gordon Brothers, the childrenswear retailer noted it expects to enter into a definitive agreement as soon as March, with previously appointed financial and legal advisors to oversee the process.