Sanderson shops $750 million term loan B at Libor plus 225-250 bps

By Sara Rosenberg

New York, Sept. 9 – Sanderson Farms Inc./Wayne Farms LLC is talking its $750 million seven-year term loan B (BB+) at Libor plus 225 basis points to 250 bps with a 0.5% Libor floor and an original issue discount of 99.5, according to a market source.

The term loan has 101 soft call protection for six months, the source said.

BofA Securities Inc., Rabobank, BMO Capital Markets, BNP Paribas Securities Corp., Fifth Third, PNC Bank, Regions, SMBC, UBS Investment Bank and Wells Fargo Securities LLC are the leads on the deal that launched with a call on Wednesday.

Commitments are due at 5 p.m. ET on Sept. 22, the source added.

Proceeds will be used to help fund the acquisition of Sanderson by Cargill and Continental Grain Co. and merger of Sanderson with Wayne Farms, a subsidiary of Continental Grain.

Other funds for the transaction will come from equity.

Under the agreement, Sanderson is being bought for $203 per share in cash, representing a total equity value of $4.53 billion.

Closing is expected by the end of 2021 or early 2022, subject to regulatory and Sanderson stockholder approval, and other customary conditions.

Sanderson is a Laurel, Miss.-based producer of fresh, frozen and minimally prepared chicken. Wayne Farms is an Oakwood, Ga.-based poultry producer.

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