Land O'Lakes term loan "B" has been ticking up into the 98-981Ž2 range with the company poised to offer $150 million in senior secured notes due 2010. One buysider said Land O'Lakes was appealing to its bank group for an amendment to the facility to issue the bonds. Proceeds from the issue are believed to be earmarked for pay downs across the term loans. Land O'Lakes had almost $300 million outstanding on its "A" loan and about $205 million on its "B" loan at the end of last quarter. J.P. Morgan leads the credit.
The bonds will be secured on a second-lien basis with Land O'Lakes' assets and the guarantors that secure the bank loan. Market players suggested that the food and agricultural cooperative came to the market early this year looking for another financing package, which ultimately was not completed. No more details on the composition of that financing could be determined. Calls to the company's financial officials were referred to a spokeswoman who declined to comment on the offering.