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Ralcorp repays term loan with new $775 million three-month term loan
By Angela McDaniels
Tacoma, Wash., Jan. 24 - Ralcorp Holdings, Inc. entered into a new $775 million term loan due April 19, 2012 on Jan. 20, according to an 8-K filing with the Securities and Exchange Commission.
The interest rate is Libor plus 150 basis points to 200 bps.
The loan is prepayable at any time. The company is required to use the proceeds of certain debt issues to prepay amounts under the loan.
Barclays Bank plc is the administrative agent. JPMorgan Chase Bank, NA is the syndication agent. Wells Fargo Bank, NA, SunTrust Bank, PNC Capital Markets LLC and Credit Suisse AG, Cayman Islands Branch are the documentation agents.
Barclays Capital Inc. and J.P. Morgan Securities LLC acted as the bookrunners and lead arrangers.
The company paid a 0.05% closing fee.
The proceeds have been used for general corporate purposes, including the repayment of the company's $550 million term loan due Oct. 2, 2012. The old term loan was terminated.
The new term loan is secured by the pledge of 65% of the equity interests of Ralcorp's first-tier material foreign subsidiaries.
The term loan's financial covenants require the company to maintain an interest expense coverage ratio of at least 3 times and a leverage ratio of not more than 3.75 times.
The term loan also contains covenants that make restrictions on certain preferred stock and dividends, debt, mergers and fundamental changes, sale of assets, sale of accounts, investments and purchases, contingent obligations, liens, transactions with affiliates, subordinated debt, changes in corporate structure or fiscal year, inconsistent agreements, ERISA compliance, restricted payments, swap agreements, sale and leaseback transactions and holding company covenants.
Ralcorp is a St. Louis-based manufacturer of private-brand food products, ready-to-eat cereal products and other regional and value-brand food products.
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