Hugo Boss Joins High Street Names Seeking Bank Support Amid Pandemic
(Bloomberg) -- Clothing retailers, including department stores, have raised $36 billion from banks to help weather store closures and lost revenues during the coronavirus pandemic.
German apparel brand Hugo Boss AG has joined more than 100 similar companies from Europe and U.S. in seeking financing support. Boss has drawn down part of its existing credit line, borrowed additional funds supported by government-owned bank KfW, and asked to waive financial covenants under its loan agreement, according to its second-quarter report on Tuesday.
Read more: Pandemic Transforms Retail Amid Structural Recovery Disparities
More than 20 firms including Columbia Sportswear Co., Next Plc and Tiffany & Co. have asked to waive or amend covenants under their loan agreements to give themselves more financial headroom. Columbia, for example, requested to waive the funded debt and interest coverage ratio covenants for this year, according to a filing.
Table below shows the sector’s loan transactions since March.
|Draw-downs ($ B)||23.27||0.8|
|New loans ($ B)||3.85||8.22|
|Number of covenant waivers/amendments||15||6|
A rising number of companies from the sector are facing distress. The U.K.’s DW Sports filed for administration on Monday while Tailored Brands Inc. of the U.S. and department store Lord & Taylor filed for Chapter 11 over the weekend.
Click here for a worksheet of draw-downs, new loans and covenant revisions in the Americas; here for EMEA, and here for Asia.
©2020 Bloomberg L.P.