By Marcus Leach
Troubled high street music and DVD store HMV has come to an agreement with its lenders for a new refinancing package.
One of the main aspects of the new agreement sees the lenders issued with warrants worth 5% of the company that can be converted into shares in 2012.
With HMV's debts in the region of £170 million, and profits slipping, times are hard for the company. Back in May HMV sold their book chain, Waterstones, to Russian billionaire Alexander Mamut (who already owns 6% of HMV) for £53 million.
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.
“Whilst HMV has had a challenging year to date, it remains a profitable and cash-generative business and a powerful entertainment brand," Chief executive Simon Fox said.
"The pace of change in the markets in which we operate underlines the urgency with which we must continue to transform this business.
“Progress at Waterstone’s this year has been pleasing, and we remain on track to meet our business and financial objectives for the end of the first year of our turnaround programme.”