Scotia Capital and Credit Suisse First Boston were wrapping up a refinancing credit for Weight Watchers International (WWI) late last week, with more than $1 billion in tickets committed to the term loan. A banker familiar with the deal explained that the loan could be for a maximum of $463 million, depending on how much of the Woodbury, N.Y.-based weight loss company's bonds are tendered. CSFB and Merrill Lynch are dealer managers and solicitation agents for WWI's current cash tender offer and consent solicitation for all of its $150 million outstanding principal amount of 13% senior subordinated notes due 2009 and all of its E100 million outstanding principal amount of 13% senior subordinated notes, also due 2009. The six-and-a-half-year loan is priced at LIBOR plus 21/4%, the banker added.
Proceeds from the deal will go toward refinancing the company's initial credit, as well as add-on pieces accrued as the company acquired franchises over the past few years, the banker explained. Last March, WWI completed an $85 million add-on loan in order to back the company's acquisition of nine of WW Group's 15 franchises in the U.S. and Mexico (LMW, 3/17). Artal Luxembourg owns most of WWI with its management company Invus Group holding four of the seven board of director seats for WWI. A WWI spokeswoman did not return calls before press time. Scotia and CSFB officials declined to comment.