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Dollar Tree launches $5.2 billion term B at Libor plus 375-400 bps
By Sara Rosenberg
New York, Jan. 26 – Dollar Tree Inc. launched on Monday its $5.2 billion seven-year term loan B with price talk of Libor plus 375 basis points to 400 bps with a 0.75% Libor floor and an original issue discount of 99, according to a market source.
The term loan B has 101 soft call protection for six months, the source said.
The company’s $6.95 billion credit facility also includes a $1.25 billion five-year revolver and a $500 million five-year term loan A.
Commitments are due on Feb. 5, the source added.
Originally, the deal was set to launch with a bank meeting, but it was changed to a conference call due to inclement weather.
J.P. Morgan Securities LLC, Wells Fargo Securities LLC, Bank of America Merrill Lynch, RBC Capital Markets LLC and U.S. Bank NA are the leads on the deal.
Proceeds will be used to help fund the acquisition of Family Dollar Stores Inc. in a cash and stock deal valued at $8.5 billion.
Under the agreement, Family Dollar shareholders will receive $74.50 per share, comprised of $59.60 in cash and $14.90 in Dollar Tree stock, subject to a collar.
The financing is expected to be completed in February.
Family Dollar stockholders already approved the transaction but the acquisition remains subject to approval by the Federal Trade Commission. Dollar Tree has made a divestiture proposal to the FTC and anticipates reaching an agreement with the FTC staff as to the specific number and locations of stores for divestiture by the end of January.
Closing of the Family Dollar acquisition could occur as soon as March.
Dollar Tree is a Chesapeake, Va.-based discount store operator. Family Dollar is a Matthews, N.C.-based chain of discount stores.
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