Bank of America Merrill Lynch, Wells Fargo, J.P. Morgan, Barclays, and Goldman Sachs have scheduled a bank meeting for 9:00 a.m. EDT on Thursday, June 5 to launch a $500 million term loan for J.C. Penney, according to sources.
Proceeds will be used to help refinance the publicly traded retailer’s existing $1.85 billion asset-based revolving credit facility, which matures in April 2016.
Alongside the term loan, the company is also launching a new $1.75 billion asset-based revolving credit. Wells Fargo will be left lead on the RC, sources said.
The loan will include a minimum-excess-availability covenant, sources noted.
As reported, the CCC+/Caa2 company disclosed last month that it received a commitment for a $2.35 billion senior secured asset-based facility that includes both a term loan and a revolver. There is $650 million outstanding under the existing ABL RC, SEC filings show
I thought there logic was not to borrow more but to payoff debt coming due and basically refinance with a longer term before the debt comes due, I think it actually lowers the entire balance by a bit by 2016 because of the change in interest rate and payment schedules.