A group of lenders led by Bank of America and Merrill Lynch have committed to providing Albertsons with a $4.667 billion facility to support the company’s merger with Rite Aid.
According to a related 8-K filing, additional commitment parties to the letter included Credit Suisse, Credit Suisse Loan Funding, Goldman Sachs, Morgan Stanley Senior Funding, Deutsche Bank Securities, Deutsche Bank New York Branch, Deutsche Bank Cayman Islands Branch, Barclays Bank, Royal Bank of Canada, Wells Fargo Bank, Wells Fargo Securities, PNC Bank, PNC Capital Markets, Suntrust Robinson Humphrey, SunTrust Bank, U.S. Bank, The Bank of Tokyo-Mitsubishi UFJ, Bank of Montreal, Fifth Third Bank, TD Bank and Capital One.
The parties committed to provide Albertsons with $4.667 billion of a new $5 billion aggregate principal amount best efforts asset-based revolving credit facility; incremental commitments under the company’s ABL facility in an aggregate principal amount of $1 billion; a new asset-based term loan facility in an aggregate principal amount of $1.5 billion and a new secured bridge loan facility in an aggregate principal amount of $500 million less the gross proceeds of new notes that are obtained on or prior to the closing date of the company’s merger with Rite Aid.
The proceeds of the financing will be used, among other things, to partially refinance certain of Rite Aid’s existing indebtedness, pay fees and expenses in connection with the merger and finance cash consideration, if any, in connection with the merger. The best-efforts ABL facility will be utilized by the company only if the additional $333 million of commitments are fully allocated to new or existing lenders prior to the date on which the merger is consummated.
The changes in the committed financing are intended to capitalize on current market conditions and reduce interest expense.
