Guess Inc. has entered into a $150 million senior secured asset-based revolving credit facility with a term of five years.
This gives the apparel retailer an expansion of its access to capital in North America and extends its existing $120 million North American credit facility.
The amended facility includes an option that allows further expansion of the total amount by as much $150 million, subject to certain conditions, according to a release from Guess.
Just as with its new European credit facility that was established earlier this year, the new domestic credit facility will include annual interest rate and fee adjustments based on the company’s achievement of certain sustainability goals in its operating and manufacturing processes, the company’s release stated.
In May of last year, Guess announced it had entered into a credit facility valued at 250 million euros through its wholly-owned Swiss subsidiary, Guess Europe Sagl.
The facility has an initial term of five years, with an option to extend the maturity date by as many as two years and an option to expand the facility by up to 100 million euros, subject to certain conditions, according to a Guess release from May.
The new facility replaced certain short-term borrowing arrangements with various banks totaling 120 million euros, the release said.
Carlos Alberini, chief executive of Guess, said that the company was pleased to enter into the new credit facility and, combined with the new 250 million euros European facility, it will now have access to more than $400 million of capital in both North America and Europe. That is a reflection of its lenders’ confidence in the company’s business strategies and financial position, he said.
“Importantly, both facilities also include sustainability incentives, which align our financial and sustainability goals and underscore our commitment to protecting the environment by integrating sustainability into our operations,” Alberini added in the statement.
The interest rate for the new European facility will be subject to an annual adjustment based on the achievement of specific sustainability goals designed to reduce greenhouse gas emissions, increase the use of sustainably sourced materials and increase the penetration of the company’s Guess ECO products, according to the Guess release announcing the new facility.
