VALUE MERCHANTS, INC. COMPLETES FINANCING INITIATIVES
VALUE MERCHANTS, INC. COMPLETES FINANCING INITIATIVES MILWAUKEE, July 27 /PRNewswire/ -- Value Merchants, Inc.
(NYSE: VMI) has finalized the financing required to support its 1992 expansion plans and seasonal working capital needs. Value Merchants, Inc. is a value retailer operating 308 Everything's $1.00 stores and 122 Toy Liquidators stores, and is the nation's largest wholesaler of close-out toy merchandise.
The company completed a public debt offering of $17.5 million of 11 percent subordinated notes due in 1999 and also completed $13.5 million in store fixture and equipment financing, of which $9 million has been received, payable in monthly installments through 1997. The public debt offering transaction is expected to close on July 31, 1992, based on the execution of an underwriting agreement with Dain Bosworth Incorporated and Kemper Securities, Inc., effective July 24, 1992. The company also has $50 million short-term working capital lines of credit with three banks to finance its seasonal working capital requirements. "Obtaining the long-term capital to finance our growth and completing an arrangement with our commercial banks to help us finance our seasonal working capital needs concludes a challenging chapter in our evolution," Steven J. Appel, president and chief executive officer, stated. "Value Merchants decided to accept the $17.5 million proceeds from the subordinated notes at this time rather than prolong the process to attract more investors because it was important to remove the veil of uncertainty regarding our growth plans as soon as possible," Appel said. "Since we can implement our 1992 expansion plans with the $17.5 million subordinated note offering together with the $13.5 million in store fixture and equipment financing and a $4 million financing package we are arranging for our expansion into Puerto Rico, we elected to close the financing process and get on with our business," he said. "With the lower level of long-term debt from what was previously planned, we will also strengthen our balance sheet as well as reduce our borrowing costs. "We can now concentrate all our energies on executing our business strategy without distractions," Appel said. "This is a real tribute to the tenacious efforts of many of our colleagues within our company as well as our investment and commercial banks." Earlier this year, the company announced plans to open approximately 175 Everything's $1.00 and about 25 Toy Liquidators stores in fiscal 1992. Year-to-date, 101 Everything's $1.00 stores and 11 Toy Liquidators stores have been opened. -0- 7/27/92 /CONTACT: Gary I. Kastel of Value Merchants, Inc., 414-274-2976/ (VMI) CO: Value Merchants, Inc. ST: Wisconsin IN: REA SU: FNC
KK -- CL003 -- 3387 07/27/92 09:47 EDT
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|Date:||Jul 27, 1992|
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