Revlon $910 million credit facility to launch Tuesday

By Sara Rosenberg

New York, June 21 - Revlon Consumers Products Corp., a wholly owned subsidiary of Revlon Inc., will hold a conference call at 10:30 a.m. ET on Tuesday for potential lenders regarding its proposed $910 million credit facility, according to a company news release.

Citigroup is the lead bank on the deal.

The facility consists of a $750 million term loan with price talk of Libor plus 600 to 625 basis points and a $160 million asset-based revolving credit facility with price talk of Libor plus 250 basis points, a fund manager told Prospect News.

Proceeds will be used to refinance the existing credit facility that currently has about $290 million outstanding, to refinance the approximately $363 million 12% senior secured notes and to pay about $95 million in transactional fees and expenses, tender costs and accrued interest, the release said.

The company expects to complete the tender offer for the bonds and close on the credit facility sometime in mid-to-late July.

"Revlon continues to make meaningful progress to create long-term value and today's announcement outlines a key financial building block to doing so," president and chief financial officer Jack Stahl said in the release. "At the same time, we expect to achieve strong growth in operating earnings for the year, despite our current expectation of relatively modest growth in 2004 in the overall U.S. mass market color cosmetics category."

This is Revlon's second attempt at a refinancing this year. In April, the company announced plans to get a new $680 million credit facility, sell $400 million of senior notes and complete a tender offer for the outstanding 8 1/8% senior notes due 2006, the 9% senior notes due 2006 and the 12% senior secured notes due 2005. However, the refinancing attempt was pulled in May due to "current unfavorable market conditions," according to a previous company news release.

The $680 million credit facility (B2/B) that was previously in-market came via JPMorgan and Citigroup. The facility included a $530 million six-year term B at Libor plus 425 basis points and a $150 million five-year revolver at Libor plus 325 basis points with a 50 basis points undrawn fee.

Syndication of the term loan B met with some resistance, even though the company increased pricing on the tranche by 100 basis points to Libor plus 425 basis points from Libor plus 325 basis points and added 101 soft-call protection after price talk on the proposed bond offering headed higher.

Revlon is a New York manufacturer and seller of cosmetics and skin care, fragrance and personal care products.

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