Rent-A-Center looking to refinance its existing debt liability

Rent-A-Center is the largest rent to own operator with around 3,020 stores across the nation. It also has its presence in countries like Canada, Mexico and Puerto Rico.

The present $375 million credit facility of the company will expire by the end of September, this year. The new agreement will help the company repay the existing debt which is at present $358 million out of the total credit facility. The company expects to complete the deal by the third quarter of this year.

Chief Finance Officer of the company, Robert D. Davis said in a statement, “We believe the current credit market, low interest rate environment and our sound balance sheet provides us with an opportunity to lower our cost of capital and further enhance our financial flexibility by extending maturities and moderating the amount of mandatory debt services over the next several years.”

Rent-A-Center stores offer a wide range of goods that include consumer electronics, computers, home appliances, furniture and accessories. The company offers these goods at rental purchase agreements that allow the consumer to attain ownership of the product after the rental period comes to an end.

A subsidiary of the company, ColorTyme, Inc. operates nearly 210 rent to own stores under the same name.

Rent-A-Center was established in 1986 with a humble beginning of 16 stores. In 1998, it made its largest acquisition when it acquired 1,409 stores from Thorn Americas. In 2006 the company succeeded in acquiring 782 stores from RentWay, its third largest rival at that time.

Rent-A-Center is now the largest operator in this field and has 18,990 employees on its rolls.

Besides, ColorTyme, the other subsidiaries of Rent-A-Center are Get It Now! a Wisconsin based company offering goods on instalment sales, Rent-A-Center Corporate Leasing which provides furnishings for businesses looking for arrangements for their employees for short periods, national Product Service, which provides repair services and warranty to store customers.

The company holds around 35 percent of the market share in the U.S. Besides serving customers who find it otherwise difficult to obtain products due to lack of finance or credit, the agreements of the company also cater to the needs of those customers who are looking for products to fulfil their temporary needs.