Kmart 'B' Falls Short, Banks Fill The Void

  • 27 Apr 2003
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Bank lenders were being rolled into Kmart's $200 million "B" piece that was originally set aside for institutional players after buyside commitments left the tranche short last week. GE Commercial Finance, Bank of America and Fleet Retail Finance were allocating the $2 billion exit facility to mostly agent round lenders. A banker familiar with the deal would not comment on the level of institutional "B" loan commitments, but he noted that the credit was not like a normal leveraged deal because pricing for the term loan and the $1.8 billion revolver were the same at LIBOR plus 31/2%. The term loan was implemented for the "B" player's benefit, he said.

Eaton Vance was said to have bought a $30 million piece of the "B" loan ahead of retail launch, while Whitehall Business Credit and LongAcre Capital Partners were also heard to be close to joining the tranche (LMW, 4/14). Kmart announced that the bankruptcy court approved its first amended joint plan of reorganization last Tuesday. A B of A official declined to comment, while a Fleet banker did not return calls. A GE spokesman declined to comment. A Kmart spokesman did not return calls.


  • 27 Apr 2003

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