Fairway launches $274.3 million term loan at Libor plus 400 bps

By Sara Rosenberg

New York, April 24 - Fairway Group Acquisition Co. launched with a call on Wednesday its roughly $274.3 million first-lien term loan due August 2018 with price talk of Libor plus 400 basis points with a 50 bps step-down if ratings are B2/B, according to a market source.

The term loan is also talked with a 1% Libor floor, a par offer price and 101 repricing protection for six months, the source said.

Proceeds will be used to reprice the company's existing term loan from Libor plus 550 bps with a 1.25% Libor floor.

In addition, the company is looking to reprice its $40 million revolver due August 2017 to Libor plus 400 bps with a 1% Libor floor from Libor plus 550 bps with a 1.25% Libor floor.

Commitments are due on Tuesday, the source said.

Credit Suisse Securities (USA) LLC, BofA Merrill Lynch and Jefferies Finance LLC are the lead banks on the deal.

Previously a source told Prospect News that the company went public last week and the stock is up 40%-plus from the IPO price, and at current valuation it trades at about 25 times last-12-months EBITDA.

Fairway is a supermarket chain with locations in New York, New Jersey and Connecticut.

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