The Secaucus-based Children’s Place on Wednesday said it entered into a new financing agreement with its majority shareholder, Mithaq Capital SPC, for an unsecured term loan of $90 million, to be funded no later than Friday.
The loan will further strengthen the company’s liquidity position on better terms in the aggregate than the previously announced loan with 1903P Loan Agent. As a result of this new financing, Children’s Place will not pursue the proposed term loan any further.
The Children’s Place said it will use the funds from the Mithaq loan to repay the existing $50 million loan, to reduce a portion of its accounts payable balances with vendors, and for other general corporate purposes.
The Mithaq loan matures in April 2027 and will accrue interest at rate plus 4% per year. with accruing interest payments to be deferred until April 30, 2025.
“We are pleased to have the continued support of our majority shareholder, and to have secured additional funding to address our liquidity needs on significantly more favorable terms in the aggregate than those contemplated by the proposed term loan. We are now better-positioned to deliver on our industry-leading digital strategy, while also remaining strongly focused on improving operational efficiency and profitability, ”Sheamus Toal, chief operating officer and chief financial officer of the Children’s Place, said.
Since Feb. 29, the Children’s Place has received $168.6 million in funding from Mithaq, composed of the $90 million new Mithaq term loan and a previously announced $78.6 million in interest-free, unsecured and subordinated term loan funding.
