Wayfair gets $600 million five-year senior secured replacement revolver

By Marisa Wong

Los Angeles, March 26 – Wayfair Inc. and wholly owned subsidiary Wayfair LLC entered into a credit agreement on March 24 with Citibank, NA as administrative agent, collateral agent, swingline lender and a letter-of-credit issuer for a $600 million senior secured revolving credit facility that matures on March 24, 2026, according to an 8-K filing with the Securities and Exchange Commission.

The credit agreement replaces and refinances Wayfair’s amended and restated credit agreement dated Feb. 21, 2019 with Citibank as administrative agent. On the effective date of the new facility, the company paid all amounts due under the existing credit agreement and terminated the commitments under that facility.

Borrowings under the new revolver bear interest at Libor plus an applicable margin based on the company’s consolidated senior secured debt to consolidated EBITDA ratio, ranging from 125 basis points to 175 bps. As of the effective date and for the first full fiscal quarter after that, the applicable margin is 125 bps.

The company is required to make mandatory prepayments prior to maturity.

The obligations are secured by first-priority liens on substantially all of Wayfair’s assets, including all of the capital stock of Wayfair’s domestic subsidiaries and 65% of the capital stock of Wayfair’s first-tier foreign subsidiaries.

The credit agreement requires Wayfair to maintain a consolidated senior secured debt to consolidated EBITDA ratio of 4 to 1, subject to a 0.5 step up following permitted acquisitions.

Proceeds may be used to finance working capital, to refinance existing debt and to provide funds for permitted acquisitions, repurchases of equity interests and other general corporate purposes.

Citibank is the lead arranger and bookrunner, Goldman Sachs Bank USA is syndication agent, and Bank of the West and Capital One, NA are co-documentation agents.

Wayfair is an e-commerce company based in Boston.

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