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Rent-A-Center refinancing senior debt

Furniture Today Staff -- Furniture Today, June 22, 2011

PLANO, Texas — Rent-A-Center said Tuesday it plans to refinance its senior debt, a move the rent-to-own merchant said should reduce its costs and give it added financial flexibility.

The company said it will enter into a new senior credit facility consisting of $250 million in term loans and a $500 million revolving credit facility. It will use the term loans and about $108 million from the revolving credit facility to pay off existing senior debt of about $358 million.

"We believe the current credit market, low interest rate environment and our sound balance sheet provides us with an opportunity to lower our cost of capital and further enhance our financial flexibility by extending maturities and moderating the amount of mandatory debt service over the next several years," said Robert Davis, the company's chief financial officer.

Rent-A-Center operates 3,020 stores in the United States, Mexico and Puerto Rico and its ColorTyme subsidiary franchises another 210 stores.

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