Obi Anyanwu
Jan 5, 2017
Sears Holdings announces $500 million secured loan facility
Obi Anyanwu
Jan 5, 2017
Sears Holdings announced on Wednesday that it has entered into a $500 million committed secured loan facility maturing in July 2020. The Loan Facility, which is comprised of entities affiliated with ESL Investments, Inc., funded $321 million of the loan, and up to an additional $179 million may be drawn by the borrowers in the future.
"This Loan Facility will provide Sears Holdings with additional financial flexibility and support our operations as we meet all of our financial obligations," said Jason M. Hollar, Sears Holdings' chief financial officer. The financial flexibility is additional liquidity to fund its operations. The company will also market and sell a portfolio of its real estate assets.
The Loan Facility is secured by mortgages on 46 real properties owned by Sears’ subsidiaries and will be secured by additional real properties if the remaining $179 million loan commitment is drawn.
Sears Holdings in December posted its fifth straight quarterly loss with total revenue falling 14.3% to $5.03 billion. Hollar said in the financial report, "We cannot guarantee when we will return to profitability, but it is our intention to do so as soon as possible." Net loss expanded to $748 million from $454 million in the prior year.
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