Saks Incorporated Completes Redemption of 2.0% Convertible Senior Notes Due 2024
NEW YORK--(BUSINESS WIRE)-- Retailer Saks Incorporated (NYS: SKS) (the "Company") today announced that it has completed the redemption of $230.0 million outstanding principal amount of its 2.0% Convertible Senior Notes due March 15, 2024 (the "Notes").
Approximately 92% of the Notes, or $212.325 million, were tendered at a redemption price equal to 100.2% of the principal amount of the Notes, plus accrued and unpaid interest to the April 15, 2013 redemption date. The redemption of these Notes was completed today.
Holders of $17.675 million of the Notes opted to convert their Notes in connection with the redemption. The conversion rate was 83.5609 shares of the Company's common stock per $1,000 principal amount of the Notes. Pursuant to the Note agreement, the Company will satisfy its obligation for these converted Notes by delivering cash to the holders based on the average closing share price for the 20 business days from April 17, 2013 to May 14, 2013.
The funding of the Notes redemption is being completed using cash on-hand and availability under the Company's revolving credit facility. No shares will be issued in the settlement of the Notes.
The Company recently amended its revolving credit agreement, increasing the maximum availability from $500 million to $600 million; extending the maturity date to March 28, 2018 from March 29, 2016 previously; and favorably revising certain terms, including interest rates and unused line fees.
Kevin Wills, Executive Vice President and Chief Financial Officer of the Company, noted, "We are pleased to settle the Notes without diluting our current shareholders. Over the last few years, we have taken a number of actions to strengthen our balance sheet and our overall financial flexibility, and we are confident that our capital structure will support our planned growth and strategic initiatives."
Saks Incorporated currently operates 43 Saks Fifth Avenue stores, 66 Saks Fifth Avenue OFF 5TH stores, and saks.com. Saks Fifth Avenue is proud to be named a J.D. Power and Associates 2012 Customer Service Champion and is only one of 50 U.S. companies so named.
The information contained in this press release that addresses future results or expectations is considered "forward-looking" information within the definition of the Federal securities laws.Forward-lookinginformation in this document can be identified through the use of words such as "may," "will," "intend," "plan," "project," "expect," "anticipate," "should," "would," "believe," "estimate," "contemplate," "possible," and "point." The forward-looking information is premised on many factors, some of which are outlined below.Actual consolidated results might differ materially from projected forward-looking information.
The forward-looking information and statements are or may be based on a series of projections and estimates and involve risks and uncertainties.These risks and uncertainties include such factors as: thelevel of consumer spending for luxury apparel and other merchandise carried by the Company and its ability to respond quickly to consumer trends; macroeconomic conditions and their effect on consumer spending; the Company's ability to secure adequate financing; adequate and stable sources of merchandise; the competitive pricing environment within the retail sector; the effectiveness of planned advertising, marketing, and promotional campaigns; favorable customer response to relationship marketing efforts of proprietary credit card loyalty programs; appropriate inventory management; effective expense control; successful operation of the Company's proprietary credit card strategic alliance with Capital One Financial Corporation; geo-political risks; weather conditions and natural disasters; the performance of the financial markets; changes in interest rates; and fluctuations in foreign currency and exchange rates.For additional information regarding these and other risk factors, please refer to the Company's filings with the SEC, including its Annual Report on Form 10-K for the fiscal year ended February 2, 2013, its Quarterly Reports on Form 10-Q, and its Current Reports on Form 8-K, which may be accessed viathe Internet atwww.sec.gov.
The Company undertakes no obligation to correct or update any forward-looking statements, whether as a result of new information, future events, or otherwise.
Julia Bentley, 865-981-6243
KEYWORDS: United States North America New York
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