Sept 18 Retailer Sears Holdings Corp
set price guidance on its new $1 billion term loan earmarked to
pay down revolver borrowings at the company, sources told
Thompson Reuters LPC.
The new first-lien term loan is guided at LIB+450-475 basis
points, with a 1 percent Libor floor and a 99 original issue
The term loan will mature June 30, 2018, and will carry 101
soft call protection for one year.
Bank of America Merrill Lynch is sole lead. Commitments are
due September 27.
The new loan falls under Sears' existing credit agreement,
inked in 2011. The existing credit includes a $3.275 billion
asset-based revolver maturing in April 2016. The revolver pays
at a range of LIB+200 to LIB+250, based on a leverage grid.
Commitment fees are in a range of 37.5 basis points to 62.5
basis points based on usage.
The new term loan is expected to be secured on a first-lien
basis on the same collateral as the revolver.
The existing credit agreement is secured by a first-lien on
most of Sears' domestic inventory and credit card and pharmacy
receivables, and is subject to a borrowing base formula to
At August 3, Sears had $1.5 billion of borrowings
outstanding under the existing credit.
Sears Roebuck Acceptance Corp and Kmart
Corporation are the borrowers.