// New Look completes refinancing scheme
// The scheme includes a debt-for-equity swap to reduce debt from £500m to £100m
// There is also a £40m cash injection to help steer New Look’s business plan
New Look has announced that it has completed a major restructuring of its finances to reduce its costs after sales were hit by the coronavirus pandemic.
The fashion retailer confirmed that in light of the High Court’s sanction of New Look Financing PLC’s Scheme of Arrangement, it has completed its comprehensive financial recapitalisation transaction.
New Look said the recapitalisation would significantly reduce long-term debt and provide financial strength and flexibility to deliver a sustainable trading platform and to execute on its strategy.
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The refinancing features a significant deleveraging of balance sheet through a debt-for-equity swap on New Look’s current debt.
This would reduce the retailer’s senior debt from around £550 million down to £100 million, while also decreasing interest costs.
The refinancing also features an extension of primary working capital facilities to provide further financial support with no near-term maturities, and an injection of £40 million of new capital to support New Look’s business plan.
The refinancing scheme was first announced in August, alongside a CVA that went on to gain approval from creditors last month.
“I would like to thank our banks, bondholders, landlords and creditors for their support during our financial recapitalisation process and CVA,” New Look chief executive Nigel Oddy said.
“Completion of the transaction today means we now have significantly enhanced financial strength and flexibility, and a sustainable platform for future trading and investment.
“Looking ahead, notwithstanding the challenging market conditions, we are focused on delivering our strategy to enhance our position as a leading convenient broad appeal fashion destination.”