Toys ‘R’ Us discloses talk on $1.38 billion of loans with launch

By Sara Rosenberg

New York, Sept. 29 – Toys ‘R’ Us – Delaware Inc., a wholly owned subsidiary of Toys ‘R’ Us Inc., released price talk on its $1,375,000,000 in secured loans in connection with its bank meeting on Monday, according to a market source.

The $1,025,000,000 5½-year term loan B-4 is talked at Libor plus 800 basis points to 825 bps with a 1% Libor floor and an original issue discount of 99, and the $350 million five-year first-in, last-out asset-based loan is talked at Libor plus 550 bps to 575 bps with a 1% Libor floor and a discount of 99, the source said.

The term loan B-4 is non-callable for 18 months, then at 102 for a year and 101 for the following year, and the first-in, last-out loan has 101 call protection for one year.

Goldman Sachs Bank USA and Bank of America Merrill Lynch are the lead banks on the deal, with Goldman the left lead on the term loan B-4 and Bank of America left lead on the first-in, last-out loan.

Commitments are due on Oct. 7, the source added.

Proceeds will be used to refinance $646 million of secured term loans due fiscal 2016, a significant portion of the $583 million of incremental secured term loans due 2018 and $350 million of 7 3/8% senior secured notes due 2016.

Toys ‘R’ Us is a Wayne, N.J.-based toy retailer.

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