LA Fitness launches $700 million term loan B at Libor plus 325 bps

By Sara Rosenberg

New York, April 5 – LA Fitness (Fitness International LLC) held a lender call at 3 p.m. ET on Thursday to launch a $700 million seven-year covenant-light term loan B (B1/BB-) that is talked at Libor plus 325 basis points with a 0% Libor floor and an original issue discount of 99.5, according to a market source.

The term loan has 101 soft call protection for six months.

There is cashless roll available to existing lenders, the source continued.

Bank of America Merrill Lynch, MUFG, Bank of the West and Fifth Third Bank are the lead arrangers on the deal.

Commitments are due at noon ET on Tuesday, the source added.

Proceeds will be used with new pro rata facilities to refinance existing credit facilities and to fully redeem the outstanding $337 million of 6% preferred equity held by Seidler Institutional and Madison Dearborn Partners.

LA Fitness is an Irvine, Calif.-based non-franchised fitness club operator.

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