Blackstone Group's credit arm acquiring additional J. Crew debt: Reuters – Money Perception

Loknath Das May 3, 2017 Credit & Debt

GSO Capital Partners, the credit arm of private-equity firm Blackstone Group LP, is acquiring more of J. Crew Group Inc.’s debt in an effort to gain a controlling position in the company’s bonds, according to a Reuters report. The struggling apparel and accessories retailer, whose brands include J. Crew and Madewell, has $2.1 billion in debt, with $567 million in unsecured bonds coming due in 2019. The company is trying to create a new company for the intellectual property of its namesake brand, cutting the bond’s value in half, but is facing pushback from bondholders like Eaton Vance Management and Highland Capital Management LP who say that’s tantamount to a default. GSO’s move could give J. Crew two additional years to turnaround the company. And sources tell Reuters GSO will ask for a better offer on its bonds. J. Crew announced last week that it’s cutting 250 jobs to lower costs. The SPDR S&P Retail ETF is down 2.5% for the year to date while the S&P 500 indexSPX, +0.12% is up 6.7% for the same period.

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