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Rite Aid initiates debt refinancing
February 1st, 2013
CAMP HILL, Pa. – Rite Aid Corp. plans a series of refinancing transactions to extend the maturity of some debt and reduce interest costs.
The drug chain said late Thursday that the transactions are slated to include the amendment and restatement of its current revolving credit facility along with the refinancing of a $1.039 billion term loan due in 2014 with the proceeds of a new term loan plus borrowings under the amended credit revolver.
In addition, Rite Aid is commencing cash tender offers for its $410 million aggregate principal amount of 9.750% senior secured notes maturing in 2016; $470 million in 10.375% senior secured notes due in 2016; and $180.3 million in 6.875% senior debentures maturing in 2013, using the proceeds from new first and/or second-lien term loans, together with borrowings under the amended revolver and available cash.
Rite Aid noted that it hasn't yet determined the amount of the amended credit revolver or new term loans. The company said it has signed commitments for a $1.5 billion revolving credit facility, subject to customary terms and conditions.
The retailer added that the results of operations and guidance likely will be impacted by fees, expenses and charges related to the refinancing transactions.
The tender offers are set to expire at midnight on Feb. 28, unless extended or terminated earlier, Rite Aid said.