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Debenhams completes major refinancing

Debenhams has refinanced its borrowing facilities in an effort to reduce its reliance on traditional bank funding.

GENERAL MERCHANDISE

Debenhams completes major refinancing

The department store has priced its offering of £225 million senior notes, which are due in 2021, at 5.25%. The offering was upsized from the £200 million announced on 20 June 2014.

Debenhams said the offer is expected to close on 2 July 2014. The proceeds from the issue and sale of the notes will be used to prepay existing credit facilities and to pay the fees and expenses related to the offering and sale.

On completion, Debenhams will extend its existing bank financing arrangements to October 2018 in the form of a £425 million revolving credit facility.

Debenhams chief executive Michael Sharp said: "This refinancing will allow us to reduce our reliance on traditional bank funding and fulfil our desire to diversify our sources of funding. In addition, we expect to achieve a material saving in interest costs over the life of the notes."

He added: "The notes offering was well-subscribed and we believe the level of demand reflects the strength of investor confidence in our business and our strategy to build a leading international, multi-channel brand."

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