A&P lowers pricing on $350 million term loan to Libor plus 700 bps

By Sara Rosenberg

New York, Dec. 21 - The Great Atlantic & Pacific Tea Co. Inc. (A&P) reduced pricing on its $350 million term loan to Libor plus 700 basis points from Libor plus 750 bps, according to a market source.

In addition, the original issue discount tightened to 99 from 98, the source said.

As before, the term loan has a 1.75% Libor floor and 101 soft call protection for one year.

The company's $800 million 18-month debtor-in-possession financing facility also includes a $450 million revolver that is expected at Libor plus 300 bps with a 50 bps unused fee.

JPMorgan is the lead arranger, bookrunner and administrative agent on the deal.

Financial covenants include requirements related to minimum excess availability, minimum liquidity and minimum cumulative EBITDA.

Proceeds from the DIP loan will be used to refinance the company's pre-petition senior secured credit facility, to provide incremental liquidity, and for working capital and general corporate purposes.

The company announced on Dec. 12 that it filed for Chapter 11 to facilitate a financial and operational restructuring designed to restore its long-term financial health.

Great Atlantic & Pacific Tea is a Montvale, N.J.-based supermarket chain.

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