United Natural Foods revises tranching, lifts term loan B pricing

By Sara Rosenberg

New York, Oct. 17 – United Natural Foods Inc. downsized its seven-year term loan B to $1.8 billion from $2.05 billion, added a $150 million 364-day term loan B and upsized its ABL revolver to $2.1 billion from $2 billion, according to a market source.

Also, pricing on the seven-year term loan B was increased to Libor plus 425 basis points from Libor plus 375 bps and the original issue discount widened to 98 from 99.5, the source said.

Furthermore, the 101 soft call protection on the seven-year term loan B was extended to one year from six months and a springing maturity was added to December 2024 if the Whole Foods/Amazon contract is not renewed.

The seven-year term loan B still has a 0% Libor floor.

Goldman Sachs Bank USA, Bank of America Merrill Lynch and U.S. Bank are the leads on the deal.

Commitments are due at the end of the day on Thursday, the source added.

Proceeds will be used to fund the acquisition of SuperValu for $32.50 per share in cash, or about $2.9 billion, including the assumption of outstanding debt and liabilities, and to refinance existing debt.

Closing is expected in the fourth quarter, subject to antitrust approvals, SuperValu shareholder approval and other customary conditions.

United Natural Foods is a Providence, R.I.-based wholesale distributor to the natural, organic and specialty food industry. SuperValu is an Eden Prairie, Minn.-based supermarket operator and wholesale grocery distributor.

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