Big Lots has entered into a sale and leaseback agreement with affiliates of Blue Owl Capital covering the company’s distribution center in Apple Valley, CA, and 26 owned store locations in a deal expected to raise a net $310 million for the retailer.
Big Lots expects gross proceeds from the transaction to be $318 million, with an anticipated yield of $310 million after expenses and taxes, the company pointed out.
From the net proceeds, Big Lots intends to use $100 million to fully pay down its synthetic lease on the Apple Valley distribution center while dedicating the remainder to paying down debt on its asset-based lending revolving credit facility.
In announcing the transaction, Bruce Thorn, Big Lots president and CEO, said, “We are pleased to have reached a definitive agreement with Blue Owl for the sale and leaseback of our Apple Valley distribution center and the vast majority of our remaining owned stores. As we discussed on our Q1 earnings call, we are highly focused on ensuring we have plenty of liquidity to get through this period of macroeconomic challenges, and monetizing these assets is a significant step forward in ensuring such liquidity. Blue Owl has been a good partner on our other regional distribution centers, which we sold and leased back in 2020, and we look forward to furthering our relationship through this transaction.”
