Paperchase has secured multi-million pound funding in a deal that will drive its expansion in Britain and overseas, just months after holding plans to sell the business.
According to The Times, the stationery, greeting cards and gifts retailer has negotiated a £50m facility from Permira, the private equity group, and Lloyds Bank Commercial Banking. The deal consists of a £32m six-year loan from Permira Credit Solutions, the debt lending and advisory business of Permira, and £18m from Lloyds.
The new financing comes approximately three months after Primary Capital, Paperchase‘s owner, cancelled a proposed sale for £150m because bidders failed to offer the right price for the company.
Paperchase is one of the biggest stationery retailers in the UK, with around 130 stand-alone stores and 31 concession stores in outlets including House of Fraser and Selfridges. In the last year, it has launched in Canada through Hudson‘s Bay, a large department store chain, as well as teaming with Staples to trade from outlets in the United States.
Paperchase said that it would remain under the ownership of Primary Capital, which bought it for £20mn 2010 from Borders, the collapsed American bookseller.
“The debt will enable us to further build on the momentum in the business and continue to deliver our ambitious growth plans,” said Timothy Melgund, Paperchase CEO
Reportedly, Dan Hatcher of Permira said that it was providing finance as Paperchase was an innovative and growing business.