Nordstrom Inc. was so desperate for cash when the pandemic took hold last year that it mortgaged prized assets and took on high-cost debt once reserved for some of the riskiest companies. Now, thanks to the red-hot corporate bond market and borrowing costs that remain near some of the cheapest ever, the luxury department store chain is beginning to dig out of a hole that pushed one of its credit ratings into junk and threatened to snowball into a cash crisis, Bloomberg News reported. Analysts say Nordstrom’s debt sale this week is an important step on its long road back to full blue-chip status in the debt markets. The retailer sold $675 million of unsecured bonds Wednesday to finish repaying debt it took on at the panicked height of the pandemic last year. The buyback frees up prized real estate including its Seattle flagship that served as collateral. It buys the company more time to repay its debt, and helps improve its challenged liquidity position — all steps that will help the company boost its credit ratings if operations continue to rebound this year. Refinancing debt or loosening credit terms had become a particular focus of members of the Nordstrom family after deteriorating ratings last year triggered borrowing restrictions including collateral pledges.
