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Published on 5/4/2012 in the Prospect News Bank Loan Daily.

Wolverine $900 million term loan to be split between A and B tranches

By Sara Rosenberg

New York, May 4 - Wolverine Worldwide's proposed $900 million of term loan debt will be divided between a $400 million A loan and a $500 million B loan, according to an 8-K filed with the Securities and Exchange Commission on Friday.

As was previously reported, the $1.1 billion senior secured credit facility also includes a $200 million revolver.

J.P. Morgan Securities LLC and Wells Fargo Securities LLC are the lead banks on the deal.

Proceeds from the credit facility, along with $375 million senior unsecured notes, will be used to fund the $1.23 billion acquisition of Collective Brands Inc.'s Performance + Lifestyle Group.

The notes are backed by a commitment for a $375 million senior unsecured bridge loan.

Under the agreement, Collective Brands is being acquired for $21.75 per share in cash, or roughly $2 billion including the assumption of debt, by Wolverine Worldwide, Blum Capital Partners and Golden Gate Capital.

At close, Wolverine Worldwide will get Collective Brands' Performance + Lifestyle Group, which includes the wholesale and retail operations of the Sperry Top-Sider, Saucony, Stride Rite and Keds brands, and will continue to operate out of Lexington, Mass.

Blum Capital and Golden Gate will get the operations of Payless ShoeSource and Collective Licensing International, which together will operate as a stand-alone entity. Payless will continue to have headquarters in Topeka, Kan., and Collective Licensing in Englewood, Colo.

Blum Capital and Golden Gate Capital have received a commitment for a $250 million senior secured asset-based revolving credit facility from Wells Fargo Capital Finance for the buyout.

Closing is expected late in the third quarter or early in the fourth quarter, subject to customary conditions, including clearance under the Hart-Scott-Rodino Antitrust Improvements Act of 1976 and Collective Brands' shareholder approval.

Wolverine Worldwide is a Rockford, Mich.-based marketer of branded casual, active lifestyle, work, outdoor sport and uniform footwear and apparel. Collective Brands is a Topeka, Kan.-based footwear and related accessories company.


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