24 Hour Fitness launches $850 million loan at Libor plus 350-375 bps

By Sara Rosenberg

New York, May 15 – 24 Hour Fitness Worldwide Inc. launched on Tuesday its $850 million seven-year covenant-light first-lien term loan B with price talk of Libor plus 350 basis points to 375 bps with a 0% Libor floor and an original issue discount of 99.5, according to a market source.

The term loan has 101 soft call protection for six months and amortization of 1% per annum, the source said.

The company’s $970 million of senior secured credit facilities (Ba3/B+) also include a $120 million five-year revolver.

Morgan Stanley Senior Funding Inc., Bank of America Merrill Lynch, Barclays, RBC Capital Markets and Citizens Capital Markets are the joint lead arrangers and bookrunners on the deal.

Commitments are due at noon ET on May 24, the source added.

Proceeds will be used to refinance existing debt, to backstop, cash collateralize and/or replace existing letters of credit and to pay fees and expenses.

24 Hour Fitness is a San Ramon, Calif.-based fitness-club operator.

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