SKELMERSDALE-BASED out-of-town discount chain Matalan is expected to increase the number of its stores after completing a £300m refinancing to simplify its debt structure.

The deal comes less than a week after LDP Business revealed that the creditworthiness of loans made to the retailer had been downgraded due to “difficult trading conditions”.

Ratings agency Moody’s said it had downgraded Matalan’s corporate family rating, adding the group’s outlook remains “negative”.

Fellow ratings agency Standard & Poor’s placed Matalan’s parent company Missouri TopCo, headed by founder and former Liverpool docker’s son John Hargreaves, on CreditWatch “with negative implications”.

However, Matalan secured a Lloyds Bank-led syndicated banking package involving a £50m revolving credit facility and a £250m high-yield bond which it said will be invested in expanding the chain.

Paul Gilbert, acting Matalan chief executive and finance director, said: “We are now in a position to focus on the implementation of our growth strategy which will see continued store roll-outs, significant investment in our brand and development of our multi-channel vision.”

Paul Foster, deputy head of Lloyds Bank Corporate Markets, in Manchester, added: “The retail market has been difficult for some time, but the business, largely on account of its strong brand, is well positioned to grow through its planned new store openings, strengthening online proposition and the continued success of its clothing lines.”