Sanderson trims term B to $500 million, firms at Libor plus 225 bps

By Sara Rosenberg

New York, Sept. 23 – Sanderson Farms Inc./Wayne Farms LLC downsized its seven-year term loan B to $500 million from $750 million and set pricing at Libor plus 225 basis points, the low end of the Libor plus 225 bps to 250 bps talk, according to market sources.

The term loan B still has a 0.5% Libor floor, an original issue discount of 99.5 and 101 soft call protection for six months.

With the term loan B downsizing, the company’s term loan A-1 was upsized to $1.25 billion from $1 billion, sources said.

The company’s $3.25 billion of credit facilities (Ba3/BB+) still include a $750 million revolver and a $750 million Farm Credit term loan A-2.

BofA Securities Inc., Rabobank, BMO Capital Markets, BNP Paribas Securities Corp., Fifth Third, PNC Bank, Regions, SMBC, UBS Investment Bank and Wells Fargo Securities LLC are the leads on the deal.

Commitments were scheduled to be due at 5 p.m. ET on Thursday, sources added.

Proceeds will be used to help fund the acquisition of Sanderson by Cargill and Continental Grain Co. and merger of Sanderson with Wayne Farms, a subsidiary of Continental Grain.

Other funds for the transaction will come from equity.

Under the agreement, Sanderson is being bought for $203 per share in cash, representing a total equity value of $4.53 billion.

Closing is expected by the end of 2021 or early 2022, subject to regulatory and Sanderson stockholder approval, and other customary conditions.

Sanderson is a Laurel, Miss.-based producer of fresh, frozen and minimally prepared chicken. Wayne Farms is an Oakwood, Ga.-based poultry producer.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.