J.C. Penney Co. cut the rate on a loan it’s seeking after increasing it to $2.25 billion from $1.75 billion, according to two people with knowledge of the matter.
The department-store chain looking to rebound from its worst sales year in more than two decades will pay interest at 5 percentage points more than the London interbank offered rate, down from an inital proposal of 5.75 percentage points, said the people, who asked not to be identified because terms are private. The lending benchmark will have a 1 percent minimum.
Goldman Sachs Group Inc. is leading the financing, which will be sold to lenders at 99.5 cents on the dollar, compared with 99 cents initially offered, the people said.
Proceeds will be used to fund working capital requirements and “to amend, acquire or satisfy and discharge” its 7.125 percent notes due in November 2023, the Plano, Texas-based company said in a regulatory filing.
© Copyright 2014 Bloomberg News. All rights reserved.