Petco (NASDAQ: WOOF) has recently announced an offering of $650,000,000 in aggregate principal amount of new senior secured notes. The company intends to use the net proceeds from the sale of the notes, along with borrowings under a new term loan facility and cash on hand, to repay in full its existing term loan facility, to pay related fees and expenses, and for general corporate purposes.
The notes will be guaranteed by Petco’s subsidiaries that guarantee its credit facilities and will be secured on a first-lien priority basis by security interests granted in Petco’s and the guarantors’ fixed assets and on a second-lien priority basis by security interests granted in Petco’s and the guarantors’ current assets.
The offering will be conducted in accordance with the terms and subject to the conditions set forth in the offering memorandum, and the notes will not be registered under the securities act of 1933. Petco stated that the offering is neither an offer to sell nor a solicitation of an offer to buy.
It's important to note that Petco is a well-established company, having been in operation for more than 60 years. With over 1,500 Petco stores across the U.S., Mexico, and Puerto Rico, the company offers a wide range of pet care products, services, expertise, and membership offerings both in stores and online at petco.com and on the Petco app. Additionally, the company has a strong focus on supporting thousands of local animal welfare groups nationwide and has helped find homes for over 7 million animals through in-store adoption events.
Petco's decision to issue new senior secured notes reflects its strategic financing activities and its commitment to managing its capital structure effectively. The market has reacted to these announcements by moving the company's shares 1.02% to a price of $2.97. Check out the company's full 8-K submission here.
