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Dollar Tree tightens talk, accelerates timing on $5.2 billion term loan
By Paul A. Harris
Feb. 4 – Dollar Tree Inc. tightened pricing on its $5.2 billion seven-year term loan B and closed the books early, a bank loan trader said on Wednesday.
The Libor spread was revised to 375 basis points from earlier spread talk of 375 to 400 bps.
The 0.75% Libor floor, the original issue discount of 99 and the 101 six-month soft call protection were left unchanged.
Timing was accelerated, with the books closing at Wednesday’s close, whereas they previously had been expected to remain open into Thursday.
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.
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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