Toys 'R' Us talks $1.1 billion of term loans at Libor plus 300-325 bps

By Sara Rosenberg

New York, March 7 - Toys 'R' Us Inc. launched its $1.1 billion of term loans on Monday at price talk of Libor plus 300 basis points to 325 bps with a 1.25% to 1.5% Libor floor and a par offer price, according to a market source.

There is 101 soft call protection for six months, the source said.

The debt consists of an amended $700 million term loan B-1 due Sept. 1, 2016 and a new $400 million 71/2-year term loan B-2.

Bank of America Merrill Lynch, J.P. Morgan and Goldman Sachs are the lead arrangers and bookrunners on the deal, and Wells Fargo, Credit Suisse, Citigroup and Deutsche Bank are bookrunners as well.

Proceeds will be used to refinance/reprice an existing term loan that also matures in September 2016 and to repay the $500 million of 7 5/8% notes due August 2011 on or before maturity.

In August 2010, as part of a refinancing, the company got its $700 million secured term loan at pricing of Libor plus 450 bps with a 1.5% Libor floor and an original issue discount of 981/2. There is 101 soft call protection for one year.

Commitments are due on March 14 and closing is targeted for around March 18.

Toys 'R' Us is a Wayne, N.J.-based toy retailer.

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