Scotia Capital and Credit Suisse First Boston have shifted the tranche size and pricing on Weight Watchers International's $500 million credit facility in the wake of oversubscription. The facility was originally pitched as a $250 million revolver priced at LIBOR plus 134% and a $250 million "B" loan priced at LIBOR plus 2%. The revolver was increased to $350 million and the "B" loan was decreased to $150 million.
In addition, the pricing on the "B" piece has been moved down to LIBOR plus 134% to be consistent with the revolver, according to a source familiar with the deal. "They're decreasing pricing from an already low level to below the lowest level," said one buysider who still plans to invest in the loan. "It's a good credit. At least they've had some positive deleveraging." Another loan investor said he attributes the low pricing to Weight Watchers being a "great company." He said, "Their market capital is measured in billions... There's not a lot of leverage." The revolver matures in 2009 while the term loan matures in 2010. The deal is expected to close this week.