Rent Way stock closed at $4.57, down 2.97% (0.14)
Rent-Way, today reported that
its previously announced sale of $205 million of senior secured
notes has closed. In connection with the note sale, the Company
also closed a new $60 million revolving line of credit and sold
$15 million in newly authorized 8% convertible preferred stock
through a private placement.
Rent-Way used the net proceeds of the offering, together with
borrowings under the new revolving credit facility and the net
proceeds of the sale of the convertible preferred stock, to
repay all amounts outstanding under its current bank credit
facility. Following the refinancing, Rent-Way has approximately
$20 million available under its new revolving credit facility.
As a result of the completion of the refinancing, the Company
expects Standard & Poor's Ratings Services to raise its
corporate credit rating from 'CCC' to 'B+'.
Chairman and CEO of Rent-Way
"We are pleased to have closed this refinancing and with the
confidence that high quality institutions have demonstrated in
Rent-Way's future. Store traffic continues to be strong as a
result of a highly successful sales and marketing campaign that
began late last year and our brand has built momentum. Over the
next 18 months, our focus will be on growing store revenues and
profits. We also expect to begin opening new stores in
profitable markets in fiscal 2004."
Mr. Morgenstern concluded, "The rent-to-own market has grown
6.2% annually since 1995. Rent-Way is now operationally and
financially prepared to capitalize on our own significant
position in this vibrant and expanding market. Our commitment is
to a business strategy centered on creating a store environment
where our customers, employees and stakeholders feel `Welcome,
Wanted and Important.' This commitment supports our vision: to
be the nation's rent-to-own company of choice."
The Company is planning to hold a public conference call
later in this quarter or early next quarter to further discuss
this refinancing as well as to provide guidance on its business
plans for the next 18 months.
RTO Online is the official channel for Rent-to-Own Industry News and the
only independent source of news for the rent-to-own, rental-purchase,
lease-purchase trade. RTO Online (Rent to Own Online) represents the choice
of the entire RTO Industry for trusted information, as it happens.
Tell us what you think
Rate the article at the top of this page