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Supervalu enters into $650 million revolver via JPMorgan Chase and Bank One
By Sara Rosenberg
New York, April 23 - Supervalu Inc. entered into a new unsecured $650 million revolving credit facility Tuesday, according to a company filing with the Securities and Exchange Commission. JPMorgan Chase Bank was the administrative agent and Bank One was the syndication agent for the loan.
The revolver matures in April 2005 and is replacing the company's previous $400 million revolver that was scheduled to mature in Oct. 2002 and its $300 million revolver that was scheduled to mature in Aug. 2002. There is a utilization fee of 25 basis points on all outstanding borrowings.
The interest rate on the loan varies depending on the credit ratings of the company's senior unsecured debt (see Table 1), ranging from Libor plus 650 basis points to Libor plus 1400 basis points. If no rating is available, the interest rate will be Libor plus 1400 basis points, the SEC filing said. The applicable facility fee rate also varies depending on debt credit ratings (See Table 1). If no rating is available, the applicable facility fee rate will be 350 basis points.
Included in the financial covenants of the loan is a requirement for the interest expense coverage ratio - defined as consolidated EBITDA (earnings before interest, taxation, depreciation and amortization) plus consolidated rent expense to consolidated interest expense plus consolidated rent expense - to be less than 3.2 to 1.0 for any period of four consecutive fiscal quarters and a requirement for the leverage ratio - consolidated debt to four-quarter consolidated EBITDA - to be greater than 3.0 to 1.0.
Table 1:
Long-term senior unsecured
debt rating S&P or Moody's Interest Rate Margin Facility Fee
BBB+ or better, or Baa1 or better Libor + 65 basis points 15 basis points
BBB or Baa2 Libor + 80 basis points 20 basis points
BBB- or Baa3 Libor + 100 basis points 25 basis points
BBB- and Ba1, or BB+ and Baa3 Libor + 132.5 basis points 30 basis points
Worse than BB+ or worse than Ba1 Libor + 140 basis points 35 basis points
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