Barnes & Noble Extends Existing US$1bn Credit Facility on Better Terms

Barnes & Noble, a large bookseller, has extended its existing US$1bn revolving credit agreement on more favourable terms. The amended credit facility takes advantage of conditions in the financial markets that are more favourable than when the original facility was established. The amended facility has lower interest costs, greater financial flexibility and increases overall borrowing capacity throughout the year. The amendment also extends the previous maturity date from 29 September 2013 to 29 April 2016.

“Amending our revolving credit facility enables us to lower our anticipated cost of capital and enhance our financial flexibility as we continue to transform the company and execute our strategic plan,” said Joseph Lombardi, chief financial officer (CFO) of Barnes & Noble. “We appreciate the strong level of support we received from our lenders.”

As a result of the amendment, the company will write-off US$6.4m in deferred financing fees from the previous facility in fiscal 2011. Beginning in fiscal 2012, the company expects lower interest costs and reduced amortisation of deferred financing fees to reduce interest expense by US$10.6m annually. The company ended fiscal year 2011 on 30 April 2011 with US$313m of outstanding borrowings under the facility.

The transaction was led by BofA Merrill Lynch, JP Morgan Securities, Wells Fargo Capital Finance, and SunTrust Robinson Humphrey as joint lead arrangers and joint book runners, and was supported by many other financial institutions. Bank of America will serve as administrative agent for the facility.


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