Value retailer Matalan has refinanced by raising £525m of debt.
The cash will be used for a shareholder payout, understood to include a £250m dividend for founder John Hargreaves, and to refinance existing debt facilities.
The debt comprises a £250m senior secured term loan and £50m revolving credit facility, each with a six-year term and margin of 500 basis points over LIBOR, and £225m of senior notes due in 2017.
Matalan chief executive Alistair McGeorge said: “Demand for the debt was strong as investors warmed to the unique strengths of Matalan’s business model and credit.
“Following three years of improving trading and results, which has been accompanied by a rapid pay down of debt, we are pleased to have completed a refinancing which will underpin our growth for many years to come.”
The refinancing, arranged by Goldman Sachs and Lloyds TSB Corporate Markets, followed Hargreaves’ failure to sell Matalan for £1.5bn.