Michaels boosts pricing on extended term loan B to Libor plus 450 bps

By Sara Rosenberg

New York, Oct. 27 - Michaels Stores Inc. increased pricing on its proposed $1 billion of extended term loan B debt (B3) to Libor plus 450 basis points from Libor plus 375 bps, according to a market source.

As a result of the change, lenders now have until 5 p.m. ET on Wednesday to consent to the deal, as opposed to noon ET on Tuesday.

The extended term loan B would mature on July 2016 instead of on Oct. 31, 2013.

However, if the company does not meet a senior secured leverage test of 3.25 times, the extended term loan B will mature 91 days prior to the maturity of the company's senior notes that are due on Nov. 1, 2014.

Pricing on the non-extended term loan B is Libor plus 225 bps.

As part of the amendment, the extended term loan B will have 25 bps of most-favored-nation protection.

Lenders are being offered a 5 bps amendment fee.

Deutsche Bank is the lead bank on the amendment.

Michaels Stores is an Irving, Texas-based specialty retailer of arts, crafts, framing, floral, wall décor and seasonal merchandise for the hobbyist and do-it-yourself home decorator.

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