Kohl’s has announced it is raising approximately $360m in aggregate principal amount through senior secured notes due 2030 to repay borrowings under its revolving credit facility while strengthening financial position.
Specifically, Kohl’s plans to allocate funds to settle all outstanding 4.25% notes due in 2025 when they reach maturity.
Go deeper with GlobalData
The collateral for these notes includes 11 distribution centres and e-commerce fulfilment facilities, which are part of a newly established holding company.
The offering is contingent upon prevailing market conditions, and there is no certainty regarding its completion or the terms upon which it may conclude.
As of 1 February 2025, the company had $290m in borrowings under revolving credit facility.
In March, Kohl’s had announced a reduction in its long-term debt by $113m, achieved through the redemption of the outstanding 9.50% notes that were set to mature on 15 May 2025.
US Tariffs are shifting - will you react or anticipate?
Don’t let policy changes catch you off guard. Stay proactive with real-time data and expert analysis.
By GlobalDataDuring the earnings call, chief financial officer Jill Timm said: “In 2025, our focus will be rebuilding our cash balance, reducing our reliance on the revolver, and capitalising on opportunities to further reduce our debt and overall leverage. We will be addressing our July 2025 maturities this spring with the intention to refinance the debt.”
In fiscal year 2024, the company saw its net sales fall 7.2% year-over-year, to $15.4bn with comparable sales declining 6.5%.
Net income was $109m, or $0.98 per diluted share and gross margin increased by 50 basis points. It had operating cashflow at $648m.
Earlier this month, Kohl’s board dismissed CEO Ashley Buchanan following an inquiry led by external legal advisors under the supervision of the company’s Audit Committee.
The investigation revealed that Buchanan engaged in directing the company to partake in vendor transactions which were found to involve undisclosed conflicts of interest. This breach of company policies was deemed sufficient grounds for termination by the board.
Subsequently, Michael Bender has been appointed as the interim CEO.
