Rite Aid Corp. reworked its credit agreement, increasing it to $1.75 billion from $1.4 billion because of market conditions, said Kevin Twomey, senior v.p. and chief accounting officer. "We had an overallotment, or greenshoe [option], so yes they exercised it," he said of lead banks Citigroup and JPMorgan. "But that is typical. They didn't exercise all of it."
The deal originally consisted of a $950 million revolver priced at LIBOR plus 1 3/4% and a $450 million senior secured term loan priced at LIBOR plus 1 3/4%. The new $1.75 billion senior secured revolver is priced at LIBOR plus 1 1/2%. The amendment also reduces the commitment fee from 37.5 basis points to 25 basis points. Twomey would not comment on the company's decision to use Citigroup and JPMorgan but said Rite Aid has worked with both banks before.
