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Breaking News: Ailing Sears to Borrow Another Billion Dollars

Beset by troubles, Sears Holding Corp. has announced it is seeking a secured term loan of $1 billion  in order to refinance already existing debt.

The loan will replace Sears’ existing $3.275 billion asset-based credit line. A spokesperson from the ailing retailer said that the loan will be secured by the same collateral already in place.

This type of revolving credit facility allows a borrower to repay part of the debt and then subsequently borrow again. The loan is set to mature in April 2016. So far Sears has drawn about $2.2 billion of the funds available to it.

The retailer has seen better days,  reporting a second quarter  net loss of $194 million, compared to $132 million at the same time last year. Revenues plunged 6.3% to $8.87 billion from $9.47 billion.

The formerly dominant market leader posted a loss $1.70per share versus the prevailing Wall Street expectation of a more modest $1.10 loss, a 7.8% overall depreciation. Same store sales dropped 1.5%, with Kmart dipping 2.1%.