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May 29, 2020, 6:58 a.m. EDT

Party City's stock rockets after TSA with bondholders aimed at reducing leverage, boosting liquidity

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By Tomi Kilgore

Shares of Party City Holdco Inc. /zigman2/quotes/209141609/composite PRTY 0.00% rocketed 60% in premarket trading Friday, after the party goods retailer said it reached a transaction support agreement (TSA) with its bondholders, which aims to reduce leverage by about $450 million, raise $100 million in new capital and eliminate substantially all of the restrictive covenants and certain events of default. The TSA is expected to lead to an exchange offer in which the 6.125% 2023 and 6.625% 2026 senior notes are exchanged for 19.9% of Party City common stock outstanding, $100 million in 10% notes due 2026 and $185 million in notes due 2025. The company will also initiate a rights offering in which certain note holders will have the right to buy a portion of $50 million of 15.00% senior notes due 2025. The stock has dropped 48.7% over the past three months through Thursday, while the S&P 500 /zigman2/quotes/210599714/realtime SPX +1.05% has gained 2.6%.

/zigman2/quotes/209141609/composite
US : U.S.: NYSE
$ 1.32
0.00 0.00%
Volume: 2.59M
July 10, 2020 4:00p
P/E Ratio
N/A
Dividend Yield
N/A
Market Cap
$124.73 million
Rev. per Employee
$235,681
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/zigman2/quotes/210599714/realtime
US : S&P US
3,185.04
+32.99 +1.05%
Volume: 2.41B
July 10, 2020 5:09p
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