Rent-A-Center Announces New Credit Facility Refinancing
Rent-A-Center announced the completion of the previously announced refinancing of its senior credit facility. As previously announced, the company formerly anticipated entering into a new $850 million senior credit facility, consisting of a $350 million term loan and a $500 million revolving credit facility. However, the company entered into a larger, new $900 million senior credit facility, consisting of a $225 million term loan and a $675 million revolving credit facility.
With the larger facility, RAC expects to access a larger pool of capital while lowering the average cost of indebtedness. The company then drew down the $225 million in term loans and $100 million of the revolving facility and utilized the proceeds to repay its existing senior term debt.
“We believe the increased liquidity provided by the larger revolving credit facility and moderation of mandatory principal payments over the next seven years will further enhance our financial flexibility as we continue to execute on the strategic initiatives outlined at our recent investor day,” commented Robert D. Davis, CEO. “In addition, this financial flexibility will allow us to continue to return value to our shareholders through dividend payments and opportunistic share repurchases.”
Plano, TX-based Rent-A-Center is a rent-to-own operator.