Talbots sets talk on first- and second-lien term loans with launch

By Sara Rosenberg

New York, March 4 - Talbots Inc. released price talk on its $255 million six-year covenant-light first-lien term loan and $100 million seven-year covenant-light second-lien term loan with its lender meeting on Tuesday, according to a market source.

The first-lien term loan is talked at Libor plus 375 basis points to 400 bps with a 1% Libor floor and an original issue discount of 99 to 991/2, and the second-lien term loan is talked at Libor plus 750 bps to 775 bps with a 1% Libor floor and a discount of 99, the source said.

Included in the first-lien term loan is 101 soft call protection for six months, and the second-lien term loan has call protection of 103 in year one, 102 in year two and 101 in year three.

Commitments are due on March 14, the source added.

Bank of America Merrill Lynch, Guggenheim and Morgan Stanley Senior Funding Inc. are the lead banks on the $355 million deal.

Proceeds will be used to refinance existing ABL and term loan debt and to fund a dividend to shareholders.

Talbots is a Hingham, Mass.-based specialty retailer and direct marketer of women's apparel, shoes and accessories.

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