Retail Giant Secures Funding Amid Pandemic Challenges
- H&M signs £859m credit facility amid Covid-19
- Facility supports liquidity amid pandemic
- 12 month deal with option for six months extension
- Additional to existing €700m RCF signed in 2017
- Group’s relationship banks support the facility
- SEB acted as co-ordinator, joined by BNP Paribas, Danske Bank, Standard Chartered Bank and Commerzbank
Swedish clothing retailer H&M has secured a new €980m (£859m) revolving credit facility to strengthen its liquidity amid the coronavirus outbreak. The deal, which lasts for 12 months with an option for a six-month extension, is in addition to the company’s undrawn €700m (£614m) RCF signed in 2017 and maturing in 2024. H&M Group’s liquidity remains good as they continue to explore various financing solutions. The facility was supported by a group of H&M relationship banks, with SEB acting as co-ordinator alongside BNP Paribas, Danske Bank, Standard Chartered Bank, and Commerzbank. Despite the negative impact of Covid-19 on its first-quarter results, H&M reported an 8% increase in net sales for the period ended 1 December 2019 at SEK 54,988m (£46,609m), compared to £51m in the previous year. The company is working extensively on managing the Covid-19 situation and evaluating all activities from a cost and risk perspective.
Factuality Level: 10
Factuality Justification: The article provides accurate information about H&M’s new €980m revolving credit facility and its additional financing solutions amidst the coronavirus outbreak. It also mentions the company’s good liquidity status and the support from relationship banks. The sales increase in the first quarter is also reported, along with the company’s efforts to manage the Covid-19 situation.
Noise Level: 3
Noise Justification: The article provides relevant information about H&M’s financial actions in response to the COVID-19 pandemic and its impact on the company’s sales. It also mentions the support from relationship banks. However, it lacks a detailed analysis or exploration of long-term trends or consequences for those affected by the decisions.
Financial Relevance: Yes
Financial Markets Impacted: H&M’s liquidity, H&M Group’s relationship banks (SEB, BNP Paribas, Danske Bank, Standard Chartered Bank, Commerzbank)
Financial Rating Justification: The article discusses H&M signing a new €980m revolving credit facility to strengthen its liquidity amid the coronavirus outbreak and mentions the company’s existing RCF from 2017. This directly pertains to financial topics such as financing solutions and impacts financial markets through the involvement of various banks.
Presence Of Extreme Event: No
Nature Of Extreme Event: No
Impact Rating Of The Extreme Event: No
Extreme Rating Justification: There is no extreme event mentioned in the text.
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