Rue21 continues growth plan, refinances with Bank of America
Warrendale, Pennsylvania-based retailer Rue21 has refinanced its existing term loan, increased its available liquidity and lowered its cost of capital.
With the help of Bank of America N.A., the company announced in a press release that it has amended its asset based credit facility to increase availability to $155 million, which is due 2025.
The amendment includes an increase to the FILO loan through a joint partnership with Bank of America and Tiger Finance. As of December 16, the company's total liquidity exceeded $100 million.
The company said 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.
"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."
The refinancing comes as Rue21 continues to implement multiple strategies to grow its business since emerging from bankruptcy in September of 2017. To date, Rue21 operates nearly 700 stores in 45 states, and plans to open 15 new stores next year.
The company also recently launched a loyalty rewards program, Rue rewards, that has already gained over 2.8 million members.
In an update to its leadership team, Rue21 named former HSN executive Bill Brand as its new chief executive officer in late October.
"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," Pascoe said.
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