El Corte Inglés is selling off assets to alleviate its debt. The department store group is negotiating the rating for its bond issue on the capital markets in an effort to reduce its dependency on the banks. In the context of this plan, the company is going to launch a string of asset divestments worth €2 billion.
The company is already working to sell assets worth up to €300 million before the autumn when it will launch the bond issue. With these resources, El Corte Inglés will have to pay off a bridge loan with Banco Santander, Goldman Sachs and Bank of America Merrill Lynch, according to El Confidencial.
The aim of El Corte Inglés is to close these operations before October, which is when the bond issue is scheduled. Through this plan, the company hopes to reduce the company’s current debt balance of €4 billion to €2 billion.
The group has already received purchase offers for some of its most profitable establishments, including those in Madrid, Barcelona and Marbella. One of them is Torre Titania, on the site of the former Windsor Building in Madrid. At the other end of the scale are the centres it opened during the start of the crisis: around 24 stores that generate heavy losses for the most part.
Last Friday, El Corte Inglés sold a percentage of share capital agreed three years ago, amounting to 10%, to the company Primefin, which is owned by Sheikh Hamad Bin Jassim Bin Jaber Al Thani. That operation was the result of the repayment of a €1 billion loan that Primefin made in July 2015. The company paid, through the delivery of shares equivalent to 0.75% of the share capital, the third and final instalment of the interest corresponding to the loan.