Michaels gets OK on amendment and $1 billion term loan extension

By Sara Rosenberg

New York, Oct. 29 - Michaels Stores Inc. received enough lenders' consents to amend its credit facility and was able to extend $1 billion of its term loan B debt to July 2016 from Oct. 31, 2013, according to a market source.

The extended debt, which was formed into a new term loan C (B3), is priced at Libor plus 450 basis points, after flexing up from original talk of Libor plus 375 bps.

Pricing on the non-extended term loan B debt is Libor plus 225 bps.

If the company does not meet a senior secured leverage test of 3.25 times, the term loan C will mature 91 days prior to the maturity of the company's senior notes that are due on Nov. 1, 2014.

Lenders are being paid a 5 bps amendment fee.

Deutsche Bank acted as the lead bank on the amendment.

Michaels is an Irving, Texas-based specialty retailer of arts, crafts, framing, floral, wall décor and seasonal merchandise for the hobbyist and do-it-yourself home decorator.

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