Standard General Is Working to Improve RadioShack’s Liquidity before Holiday Season
It has been reported that RadioShack has finalized some deals with a group of investors in order to reorganize a part of its debt and access funds.
RadioShack Corp., an American franchise of electronics retail stores, agreed to restructuring deals with a group led by Standard General LP to refinance $535 million credit facility to restock inventory before the holidays.
The Fort Worth, Texas-based RadioShack in a statement, said that Standard General, a New York-based hedge fund, and other investors have acquired a credit line that GE Capital extended to RadioShack.
Standard General and Litespeed management LLC have also agreed to give $120 million to cash collateralize letters of credit for the company.
According to Trace, the bond-price reporting system of the Financial Industry Regulatory Authority, RadioShack's $324.8 million face value of 6.75% unsecured bonds due in May raised to 7.7% on the dollar to 41.8 cents yesterday.
In the last month filing, Standard General said that it was working to improve RadioShack's liquidity before the holiday season.
It has been also reported that The Fund, one of RadioShack's largest investors, has also signed an agreement that would last until June 2015.
RadioShack's creditors earlier this year planned to close down around 1,100 stores. But Standard General emerged as a savior for the retailer in August. Standard General earlier acted as a lifeline for another retailer named American Apparel Inc.
RadioShack CEO Joe Magnacca has been remodeling stores and refurbishing its product lineup in order to restart sales.
RadioShack was started in 1921 as a mail-order retailer in Boston. The retailer later expanded its range of electronics and by 1980s was also seen as a destination for personal computers, gadgets and some rare components that were not easily available at that time.
Sources reported that in recent years the retailer is facing a tough competition from Wal-Mart and other strong online retailers.
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