Macy’s gets $1.5 billion five-year revolver at Libor plus 91-140 bps

By Wendy Van Sickle

Columbus, Ohio, May 15 – Macy’s, Inc. obtained a $1.5 billion five-year unsecured revolving credit facility on May 9, according to an 8-K filing with the Securities and Exchange Commission.

Interest on the loans will be Libor plus 91 basis points to 140 bps based on leverage and the company’s credit ratings. The facility fee ranges from 9 bps to 22.5 bps.

Bank of America Merrill Lynch, Credit Suisse Loan Funding LLC, Fifth Third Bank, U.S. Bank NA and Wells Fargo Securities, LLC are the joint bookrunners and joint lead arrangers. Credit Suisse, Fifth Third, U.S. Bank and Wells Fargo Bank, NA are the syndication agents. Bank of America, NA is the administrative agent.

The credit agreement includes a $400 million sublimit for the issuance of letters of credit and related accommodations.

The revolving credit commitments are scheduled to expire on May 9, 2024, with two one-year extension options.

Under the loan terms, the company is required to maintain a ratio of consolidated EBITDA to consolidated net interest expense of at least 3.25 times and a ratio of total debt to consolidated EBITDA of no more than 3.75 times.

The covenants also put limitations on subsidiary debt, liens, fundamental changes and sale/leaseback transactions.

The agreement replaces the $1.5 billion unsecured revolving credit dated May 6, 2016, which had been set to expire on May 6, 2021.

Macy’s is a department store chain based in Cincinnati.

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