Market Overview

Alliance Data Increases Liquidity by $750.5 Million


Alliance Data Systems Corporation (NYSE: ADS) today announced that the Company increased liquidity at the corporate level through two transactions totaling $750.5 million. This new corporate-level liquidity is in addition to the available liquidity at the Company's two private label credit card bank subsidiaries, which themselves, totaled $2.2 billion at December 31, 2011.

In the first transaction, the Company issued $500 million of senior notes, the first high-yield bond offering in the Company's history, at a rate of 6.375% and maturing in 2020. Entering the public bond market provides Alliance Data with an additional liquidity source for future capital raises. The Company initially contemplated an offering of $350 million of senior notes, but based on demand, the Company upsized the bond deal by $150 million. In addition to the bond raise, the Company raised $250.5 million of bank debt at LIBOR plus 200 basis points and extended the maturity of its Term Loan A to 2017. All in, the Company raised $750.5 million at a blended rate of approximately 5.10%. Proceeds will be used to pay down the outstanding balance of the Company's revolving credit facility with the remainder as additional cash for general corporate purposes.

Posted-In: News Financing


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