Fitch rates Macy’s loan BBB-, notes BB+

Fitch Ratings said it assigned a BBB- rating to Macy’s Inc.’s expected $3 billion secured asset-based loan facility, including about a $2.7 billion revolving credit facility.

Also, Fitch assigned a newly created special purpose vehicle, Macy’s Inventory Funding LLC a BB issuer rating. It will issue a $300 million bridge facility.

Concurrently, Fitch assigned a BB+/RR1 rating to new $1.1 billion senior secured first-lien notes due 2025 at Macy’s. The notes will be secured on a first-priority basis by a pledge from Macy’s PropCo Holdings, LLC, a direct, wholly owned subsidiary of Macy’s, and a first mortgage/deed of trust in all real property owned or to be owned by PropCo. The notes will also be guaranteed on an unsecured basis by Macy’s Retail Holdings Inc.

Fitch downgraded Macy’s and Macy’s Retail to BB from BB+.

“The downgrade and negative outlook reflect the significant business interruption from the coronavirus pandemic and the implications of a downturn in discretionary spending that Fitch expects could extend well into 2021, as well as increased leverage from the new secured bond offering,” Fitch said in a press release.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.