Children’s Place secures Saudi family office loan as sales decline
Children’s Place is seeking operational support as pressure on sales continues and liquidity remains in focus. The retailer is also drawing on additional financing from a Saudi family office that became its majority shareholder after building a controlling stake in 2024.
Highlights
- Children’s Place secured a $40 million facility from a Saudi family office and retained Berkeley Research Group for operational support amid declining sales.
- In June, Children’s Place borrowed an additional $25 million from largest shareholder Mithaq Capital, after a previous $15 million draw in July, using Shariah-compliant unsecured term loans.
- Mithaq Capital now owns 54% of Children’s Place shares, providing substantial financial support as the retailer faces liquidity challenges and prolonged sales weakness.
Operational support and new financing
As first reported by Bloomberg, Children’s Place is working with Berkeley Research Group for operational assistance while the specialty retailer faces declining sales. People familiar with the situation said the company has tapped a $40 million facility from a Saudi family office.The company disclosed last month that it borrowed another $25 million from its largest shareholder, Mithaq Capital, to bolster cash reserves, after drawing $15 million in July. Mithaq has been providing incremental cash injections through Shariah-compliant unsecured term loans.
Ownership backdrop and retail pressure
Mithaq Capital acquired 54% of Children’s Place outstanding shares in 2024, when the chain was nearing a restructuring. The latest financing adds to support from the shareholder as the retailer works to stabilize operations and preserve liquidity.Shariah-compliant financing is structured to follow Islamic finance principles, including a prohibition on conventional interest. That structure underlines the tailored nature of the funding package as Children’s Place navigates a prolonged sales slowdown.
In our earlier article, we covered ICRA placing Ozone Homes Private Limited in the “issuer non-cooperative” category after the company did not provide enough information for a rating review. We noted that this kind of classification can weaken lender and investor confidence, potentially making it harder to raise financing and adding risks for ongoing projects.
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