Borders UK has secured a £23 million asset-based loan from Icelandic bank Landsbanki.
The cash will give Borders greater liquidity and enable owner Luke Johnson’s Risk Capital private equity firm – which bought it last year in a£10 million deal – to pay down part of its investment.
Landsbanki’s loan, made through its commercial finance division, is secured against stock in Borders shops and its distribution centre. It is the latest instance of a trend towards asset-based borrowing by retailers.
Last month, Woolworths agreed a£385 million refinancing,£350 million of which was secured against store stock and wholesale arm EUK’s debtor book.
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