Saks Incorporated Completes Redemption of 2.0% Convertible Senior Notes Due
NEW YORK -- April 15, 2013
Retailer Saks Incorporated (NYSE: 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-looking information 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: the level 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 via the
Internet at www.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
Julia Bentley, 865-981-6243
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