Office supply company staples has launched a US$5.75bn financing to support its US$6.3bn acquisition of rival Office Depot. Barclays leads the deal, while Bank of America Merrill Lynch, Wells Fargo and HSBC are joint lead bookrunners. The deal comprises a US$2.75bn six-year Term Loan B and a US$3bn five-year asset-based lending revolver. Pricing guidance on the term loan opens at 350bp over Libor with a 0.75% Libor floor and a discount of 99. Staples expects to draw down US$1.5bn on the ABL facility on the close of the deal. The term loan will have soft call protection of 101 for six months and it will amortise at 5% per year. The deal includes a ticking fee that starts at 50% of the margin on May 1 and will increase to the entire margin plus the Libor floor on June 1.
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