Albertsons to launch $1.2 billion term loan on Wednesday morning

By Sara Rosenberg

New York, April 17 – Albertsons Cos. Inc. is set to hold a bank meeting at 10:30 a.m. ET in New York on Wednesday to launch its $1.2 billion five-year asset-based last-out term loan, according to a market source.

Bank of America Merrill Lynch, Credit Suisse Securities (USA) LLC, Goldman Sachs Bank USA, Morgan Stanley Senior Funding Inc., Barclays, Deutsche Bank Securities Inc., RBC Capital Markets, Wells Fargo Securities LLC and MUFG are the joint lead arrangers on the deal.

The term loan has a minimum fixed charge coverage ratio covenant of 1 time, tested when excess availability at any time is less than 10% of the loan cap, which has a $250 million floor, the source said.

Proceeds will be used to refinance existing debt at Rite Aid Corp., and if applicable, fund the cash portion of the Rite Aid merger.

Albertsons is a Boise, Idaho-based food and drug retailer. Rite Aid is a Camp Hill, Pa., national drugstore chain.

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