Pep Boys $875 million credit facility targeted to launch on April 18

By Sara Rosenberg

New York, April 9 - Pep Boys - Manny, Moe & Jack is anticipated to hold a bank meeting for its proposed $875 million senior secured credit facility on April 18, according to a market source.

Based on filings with the Securities and Exchange Commission, it is expected that the facility will consist of a $325 million asset-based revolver, a $425 million first-lien term loan and a $125 million second-lien term loan.

Credit Suisse Securities (USA) LLC and Barclays Capital Inc. are the lead banks on the term loans, and Wells Fargo Securities LLC and Barclays are leading the revolver.

Proceeds will be used to help fund the buyout of the company by Gores Group for $15 per share in cash. Total enterprise value of the transaction is about $1 billion.

Other funds for the transaction will come from around $489 million in equity.

Closing is expected in the second fiscal quarter of 2012, subject to shareholder and regulatory approvals.

Pep Boys is a Philadelphia-based automotive aftermarket chain.

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