SuperValu tightens discount price on $850 million term loan to 97

By Sara Rosenberg

New York, Aug. 9 - SuperValu Inc. revised the original issue discount on its $850 million six-year covenant-light term loan (B1/BB-) to 97 from most recent talk of 96, according to a market source. At launch, the discount had been talked at 98.

Pricing on the loan is Libor plus 675 basis points with a 1.25% Libor floor.

There is soft call protection of 102 in year one and 101 in year two.

Earlier in the syndication process, the spread on the loan had been increased from 625 bps, the tenor was shortened from seven years, and the call protection was sweetened from just 101 in year one.

Security for the term loan is a first lien in real estate with an appraised value of at least 1.5 times the amount of the loan.

Recommitments were due on Thursday.

Allocations are targeted to go out on Friday, the source added.

The company's $2.5 billion credit facility also provides for a $1.65 billion five-year ABL revolver that has pricing ranging from Libor plus 175 bps to Libor plus 225 bps.

Joint bookrunners on the term loan are Credit Suisse Securities (USA) LLC and Barclays, and joint bookrunners on the revolver are Wells Fargo Securities LLC, U.S. Bancorp Investments Inc., Barclays and Credit Suisse.

Proceeds from the credit facility will be used to refinance existing debt.

SuperValu is an Eden Prairie, Minn.-based supermarket operator.

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