Investors were treated to a preview of J. Crew Group's spring collection at a bank meeting for the company last Monday at the Waldorf Astoria in New York. As a parting gift, the buysiders were treated to a box including a thin yellow and blue diagonally striped tie, a woman's belt and a company catalogue.
The Goldman Sachs and Bear Stearns-led deal consists of a seven-year, $295 million term loan (CIN, 9/30). Pricing is in the range of LIBOR plus 2 1/4%-2 1/2% following a Ba3 rating from Moody's Investors Service. The rating agency had placed the company on review for a potential upgrade after it filed its intent to do an initial public offering.
In a release the company said it will use borrowings from the loan, proceeds from the offering, along with proceeds from the sale of $73.5 million of stock to Texas Pacific Group, its majority shareholder, to redeem outstanding cumulative preferred stock and pay off some outstanding debt (9/30). According to Moody's, the company will retire all of its preferred stock and 13.125% senior discount debentures and prepay all or a portion of its 9.75% senior sub notes. It also intends to convert its 5% notes payable to common stock. A spokesman for Texas Pacific declined comment. Jim Scully, executive v.p. and cfo, declined comment.