According to an 8K filed with the SEC, Citibank served as administrative agent and collateral agent for a new $1.7 billion first lien term loan facility and a new $500 million asset-based revolving credit facility for Petco. The term loan helped Petco refinance an existing term loan, while the new revolving credit facility replaced an existing revolving credit facility.
The new first lien term loan facility matures in 2028. Loans under the new term loan facility bear interest at a rate equal to an applicable margin plus, at Petco’s option, either a base rate or LIBOR rate. The applicable margin is 2.25% for base rate borrowings and 3.25% for LIBOR rate borrowings. The proceeds of the new term loan facility were used to repay the company’s existing $1.678 billion term loan facility maturing in 2022 and, together with available cash on hand, pay fees and expenses related to the refinancing transactions.
The new asset-based revolving credit facility matures in 2026. The new revolving credit facility replaced the company’s existing $500 million revolving credit facility maturing in 2023. Loans under the new revolving credit facility bear interest at a rate equal to an applicable margin plus, at Petco’s option, either a base rate or a LIBOR rate. The applicable margin is between 0.25% and 0.75% for base rate loans and between 1.25% and 1.75% for LIBOR loans.
“Today’s announcement is another vote of confidence in Petco and underscores our transformation into a company with strong forward momentum actively shaping its future,” Mike Nuzzo, chief financial and operating officer of Petco, said. “Our successful IPO in January enabled us to pay down significant debt and with the announcement of this oversubscribed refinancing, and our continued strong performance through the fourth quarter of 2020, we have positively repositioned Petco while enhancing our financial flexibility.”