Syndication of the financing to back Bain Capital's leveraged buyout of Nutro Products, a manufacturer of dog and cat foods, launched last week. The $540 million deal led by JPMorgan and Lehman Brothers consists of a six-year, $100 million revolver priced at LIBOR plus 2 1/2% and a seven-year, $440 million term loan "B" priced at LIBOR plus 2 1/4%.
David Kravis, the president and chief operating officer at Nutro, will become the ceo after the transaction is completed. He and current members of the management team will hold significant equity interests in the company. Kravis did not return calls and a Bain spokesman declined comment.
Nutro offers a line of natural foods for dogs including Natural Choice dog food, MAX dog food and its new Ultra holistic nutrition food. For cats, it offers Natural Choice Complete Care and its new MAX Cat Gourmont Classics. One market source said it is an attractive company because it's a strong business in a consumer category that has attractive growth prospects. Because it is marketed as a higher-end product, it is sold only at specialty pet stores and can not be bought in general food stores. Standard & Poor's assigned a B- corporate credit rating to Nutro and a B rating to the term loan and revolver.