Roundy's Supermarkets' $750 million term "B" loan broke at 100 1/4 in the secondary market last week. It traded up to 100 3/8 and then dipped back to 100 1/4. A trader said approximately $30 million traded once it broke. Roundy's announced it was refinancing most of its debt in October. It initially planned to enter a new $825 million credit comprising a $700 million term loan and a $125 million revolving credit facility. It boosted the term loan to $750 million to pay a debt-financed dividend of $400 million. Standard & Poor's raised its corporate credit rating on Roundy's Supermarkets to B+ from B. It rates the bank loan B+ with a recovery rating of 3, which indicates a 50%-80% recovery of principal if it defaults. The corporate credit rating reflects the pricing pressure in the supermarket industry because of the expansion of Wal-Mart Stores and Target Corp., as well as higher fuel prices and the weaker economy. Moody's Investors Service rates the term loan B2.
Roundy's Supermarkets Breaks Above Par