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Perry Ellis in negotiations to refinance or renew revolver
By Sara Rosenberg
New York, April 26 - Perry Ellis International Inc. is in negotiations with about six different institutions, one of which is the company's current agent bank, Bank of America, over renewing or replacing its senior credit facility, according to Rosemary Trudeau, vice president of finance. Financing is hoped to be finalized by the summer so that it can be included as an exhibit in the second quarter 10-Q, she added.
A lot of different financing options are being considered, Trudeau said, and the final choice will depend on what the various institutions offer the company. Some options include having letters of credit separate with a small advance line, establishing an asset-based credit facility, putting an asset-based credit facility and letters of credit in one agreement and factoring receivables and having a separate letter of credit facility.
In March 2002, the Miami, Fla. men's sportswear company amended its credit facility, concurrently with the sale of $57 million of senior secured notes for the purchase of Jantzen Inc. assets, reducing available borrowing under it revolver to $60 million. The revolver matures on Oct. 1, 2002 with an interest rate of Libor plus 275 basis points. The interest rate can be adjusted depending on the company's ratio of indebtedness to EBIDTA. Security for the loan is a first priority interest in substantially all existing and future assets and a second priority interest in trademarks.
As of Jan. 31, 2002, there was an outstanding balance of $21.8 million under the bank loan, according to a company filing with the Securities and Exchange Commission. In addition, as of April 15, 2002 the company had four letter of credit facilities totaling $62 million.
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