The Children’s Place Inc. announced March 11 it received $48.6 million from its majority shareholder, Mithaq Capital SPC. The infusion represents a second tranche of interest-free, unsecured and subordinated term loan funding.

The funds are part of a deal announced Feb. 29, whereby the Secaucus-based children’s specialty retailer would receive $78.6 million from its new owner, Mithaq, to support operations, such as payments to vendors and service providers. The company received the initial tranche of $30 million March 1.

The news follows a very active few weeks for The Children’s Place.

On Feb. 16, the retailer said had entered into a non-binding term sheet for a $130 million term loan – which the company recently said it expects to be in a position to close this month – as part of a move to strengthen its financial footing. Those funds from investment specialist Gordon Brothers would go toward repaying an existing $50 million loan from lenders. The day before, on Feb. 15, Saudi Arabian investor group Mithaq Capital took a 54% controlling stake in the company and announced it would shake up the board of directors.

Finalized March 8, those moves include: 

• The resignations of board members Norman Matthews, John Bachman, John Frascotti, Debby Reiner and Michael Shaffer; 
• Reducing the size of the board to six members; 
• Appointing Douglas Edwards, retired Wells Fargo executive, independent board director. 

Jane Elfers will continue to serve as president, CEO and director of the company.  

‘A strong alignment of interests’

“We are pleased to fulfill our commitment to all the Company’s shareholders by providing $78.6 million in funding, which is interest-free, unsecured, and subordinated,” Turki Saleh AlRajhi, chairman of The Children’s Place as well as chairman and CEO of Mithaq, said in a statement. “We believe that there is a strong alignment of interests between the Board and all shareholders that will help put the Company on a path to strong future free cash flow generation.” 

In the midst of these deals, The Children’s Place also decided to stay put at its headquarters in Secaucus.

In July 2023, the retailer said it would end its lease at 500 Plaza Drive early and cut 17% of its workforce, mostly staff who work at the corporate offices. However, JLL told NJBIZ March 5 that the tenant will remain at the property, but in a smaller space. 

These shakeups follow the retailer’s March 2023 announcement it would shutter 100 stores in 2023 as part of a multiyear digital transformation strategy. As NJBIZ reported, The Children’s Place has closed more than 700 locations over the past decade. Currently, it has 500 stores in the U.S., Canada and Puerto Rico.

Editor’s note: This story was updated at 3:12 p.m. ET March 12, 2024, to clarify the terms of the agreement with the Gordon Brothers.