New Issue: Rite Aid prices upsized $300 million deal at par to yield 9½%

By Paul A. Harris

St. Louis, Feb. 5 - Rite Aid Corp. priced its upsized offering of $300 million second lien senior secured notes due Feb. 15, 2011 (B3/B-) at par on Wednesday to yield 9½%, according to a syndicate source.

Price talk on the deal, which had been upsized from $200 million on Tuesday, tightened Wednesday to 9½% from the 9¾% area.

Salomon Smith Barney was the bookrunner. Credit Suisse First Boston, Fleet Securities and JP Morgan were the co-managers.

Proceeds from the Rule 144A notes will be used to repay senior secured shareholder settlement notes due 2006 and for general corporate purposes.

The issuer is a drugstore chain operator headquartered in Camp Hill, Pa.

Issuer:	Rite Aid Corp.
Amount:	$300 million (increased from $200 million)
Maturity:	Feb. 15, 2011
Security description:	Second lien senior secured notes
Manager:	Salomon Smith Barney
Co-managers:	Credit Suisse First Boston, Fleet Securities, JP Morgan
Coupon:	9½%
Price:	Par
Yield:	9½%
Spread:	571 basis points
Call features:	Callable on Feb. 15, 2007 at 104.75, 102.375, par on Feb. 15, 2009 and thereafter
Equity clawback:	Until Feb. 15, 2006 for 35% at 109.5
Settlement date:	Feb. 12, 2003 (T+5)
Ratings:	Moody's: B3
	Standard & Poor's: B-
Price talk:	9½%

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