Gymboree lowers spread on $820 million term B to Libor plus 350 bps

By Sara Rosenberg

New York, Feb. 10 - Gymboree Corp. reduced pricing on its $820 million covenant-light term loan B (B1/B+) to Libor plus 350 basis points from Libor plus 412.5 bps, according to a market source.

The 1.5% Libor floor and par offer price were left unchanged.

As before, the new loan includes 101 soft call protection for one year against repricings.

Recommitments were due at 4 p.m. ET on Thursday.

Credit Suisse Securities LLC is the lead bank on the deal.

Proceeds will be used to refinance the company's existing $820 million term loan B that was obtained in November and includes maintenance covenants. Pricing on the existing loan is Libor plus 400 bps with a 1.5% Libor floor, and it was sold at an original issue discount of 991/2.

Since the company will now be lowering the yield with the new loan, the 101 soft call protection on the existing loan will kick in. As a result, existing lenders are now getting paid down at 101 instead of at par, the source added.

Gymboree is a San Francisco-based specialty retailer.

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