Neiman Marcus is now borrowing money to make interest payments on its debt

A rolling loan gathers no loss.

That appears to be the adage guiding upscale department-store chain Neiman Marcus, which has opted to make the coming interest payments on its high-yield bonds by issuing more debt, instead of burning through cash.

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The company said it was electing the payment-in-kind (PIK) option on its $600 million in 8.75% notes due to mature in 2021 for the coming six-month coupon period through Oct. 14, according to a filing with the Securities and Exchange Commission. The move is aimed at enhancing its liquidity, the Dallas-based company said.

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