Chastened retailer Businesland Inc, which has been the subject of fevered takeover gossip since its share price plunged in the wake of unexpectedly rotten figures – Electronic Data Systems Corp is the most widely touted suitor – has legitimised its relationship with its senior noteholders once more. It has reached agreement in principle with the holders to resolve all issues of compliance with the covenants that govern its $50m of senior notes – but the settlement will cost: under the terms of the waiver provisionally granted, the effective rate of interest on the notes has been raised by 0.5% to 10.25%, and some of the financial covenants have been modified. Businessland warned with its year-end earnings that it was in violation of some covenants. Its shares plunged to around $2.50 from a 12-month high of $13.65 after it revealed a fourth quarter loss – to June 30 – of $21.5m, making it look a steal – but sceptics believe the company is unravelling so quickly, any purchaser would be swamped by a tidal wave of travail, Computer Reseller News reckons.
