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7 June 2011
Last updated at 02:53 ET
Troubled music and DVD retailer HMV has agreed a new refinancing package with its lenders, worth £220m.
The deal includes issuing the lenders with warrants worth 5% of the company, which will be converted into shares next year.
HMV has estimated debts of £170m and has issued several profit warnings.
In May it sold its Waterstone's book chain for £53m to a fund controlled by Russian billionaire Alexander Mamut, who already owns 6% of HMV.
Chief executive Simon Fox said the new bank facility "represents another important milestone in securing the financial stability of the group".
HMV's main lenders are taxpayer-backed Royal Bank of Scotland and Lloyds Banking Group.
The package is made up of separate £70m and £90m loans, and a £60m credit facility, which can be called upon if needed.
But the company faces an "exit fee" due on the £90m loan when it is repaid, which would rise to 14% by January 2013 if the loan has not been repaid by then.
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The deal includes issuing the lenders with warrants worth 5% of the company, which will be converted into shares next year.
HMV has estimated debts of £170m and has issued several profit warnings.
In May it sold its Waterstone's book chain for £53m to a fund controlled by Russian billionaire Alexander Mamut, who already owns 6% of HMV.
Chief executive Simon Fox said the new bank facility "represents another important milestone in securing the financial stability of the group".
HMV's main lenders are taxpayer-backed Royal Bank of Scotland and Lloyds Banking Group.
The package is made up of separate £70m and £90m loans, and a £60m credit facility, which can be called upon if needed.
But the company faces an "exit fee" due on the £90m loan when it is repaid, which would rise to 14% by January 2013 if the loan has not been repaid by then.
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