NEW YORK (
secured some new financing that could help continue to run its jewelry business.
The company announced on Tuesday that it received a $150 million five-year secured loan from private-equity firm
Golden Gate Capital
The deal will allow Golden Gate to purchase up to 25%, or 11 million of Zale's common stock, at $2 a share. If Golden Gate executes the warrants it would become Zale's largest shareholder.
The deal also gives Golden Gate the opportunity to get two representatives appointed to Zale's board of directors. The two new directors are Stefan Kaluzny, chairman at Express, and Peter Morrow, principal at Golden Gate.
Zale also announced that it closed on a new bank facility, led by Bank of America, with aggregate commitments up to $650 million. The jeweler said that when all is said and done it will be left with $160 million outstanding and $250 million in liquidity.
Last week, Zale came to an agreement with Citigroup to defer a $6 million payment until May 31.
-- Reported by Jeanine Poggi in New York.
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