Rent-A-Center seeks credit facility amendment to extend maturities

By Sara Rosenberg

New York, Nov. 2 - Rent-A-Center Inc. is looking to amend its senior secured credit facility to extend the maturity of revolver and term loan debt, according to a news release.

Lenders who agree to extend their revolver and term loan commitments will get higher pricing on that debt.

JPMorgan is the administrative agent on the deal.

"Our strong operating cash flow has allowed us to substantially reduce our debt level over the past 24 months," said Robert D. Davis, executive vice president and chief financial officer, in the release.

"We believe we will continue to generate strong cash flow from operations and estimate free cash flow for fiscal year 2010, after taking into account our anticipated budget for capital expenditures, to be approximately $125-145 million, which would be sufficient to address our mandatory principal payments under the senior secured credit facility in 2010.

"This reduced leverage and strong cash flow, we believe, have put us in a strong financial position and, as a result, we believe it is prudent to take this opportunity to address the bullet maturities coming due in 2011," Davis added.

Rent-A-Center is a Plano, Texas-based rent-to-own operator.

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