Online retailer THG has successfully completed its debt refinancing arrangement up until 2029.
The Manchester-headquartered company gave more details of the deal to the London Stock Exchange this morning.
As a result of the proposed refinancing, net total leverage (excluding leases) decreased from 3.2x to 2.2x, with continuing adjusted EBITDA (excluding THG Ingenuity) of £92m.
The company said: “THG is a fundamentally cash generative business and the refinancing underlines the company’s target to progress towards a neutral net cash / net debt position.”
One expert told BusinessCloud: “The bigger picture here is THG is reducing its debts ahead of the markets.”
Last week THG announced a £90m equity raise as part of a debt refinancing package – with CEO and founder Matt Moulding committing up to £60m of his own money.
Moulding’s money is in the form of a loan which converts into shares later in the year, given him 25 per cent of the shareholding.
The move follows the demerger of THG Ingenuity from the profitable THG Beauty and THG Nutrition and the company’s return to the FTSE 250 Index.
The debt refinancing deal includes a partial amend and extend of the term loan B to extend the maturity of €445m to December 2029.
It also includes a partial repayment of £74m of the term loan A and the remaining €155m of the TLB through a combination of cash on balance sheet and the equity contribution.
Finally, it extends maturity of the existing £150m RCF from May 2026 to May 2029.
J.P. Morgan and Barclays acted as mandated lead arrangers and physical bookrunners on the debt refinancing.
More details of THG’s 2024 performance will be provided as part of the group’s preliminary results and Q1 trading update expected to be announced on or around 30 April.
This morning THG’s share price was 30.39p.
Earlier this week Frasers Group raised its stake in online retailer THG to 10.9 per cent, up from 6.1 per cent.