Duane Reade pays down credit facility following buyout by Walgreen

By Angela McDaniels

Tacoma, Wash., April 13 - Duane Reade, Inc. has repaid and terminated its credit facility following the acquisition of its parent company, Duane Reade Holdings, Inc., by Walgreen Co., according to an 8-K filing with the Securities and Exchange Commission.

Borrowings under the credit agreement with Bank of America, NA as administrative agent were repaid in full except for $7.35 million of letters of credit. These will remain outstanding and will be deemed to have been issued by Bank of America as the issuing bank under an existing credit facility with Walgreen.

In addition, Duane Reade will redeem its 11¾% senior secured notes due 2015, 9¾% senior subordinated notes due 2011 and convertible notes due 2022 on May 10.

Funds for the paydown and redemptions were provided by Walgreen, which acquired Duane Reade from Oak Hill Capital Partners, LP.

Duane Reade and Walgreen are drugstore chains based in New York and Deerfield, Ill., respectively.

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