Lehman Brothers launched syndication last week of a $200 million credit to help back B&G Foods' acquisition of Nestle Prepared Food Co.'s Ortega brand for an undisclosed amount. A banker said the credit includes a six-year, $150 million "B" loan priced at LIBOR plus 31/2% and a five-year, $50 million revolver priced at LIBOR plus 31/4%. The deal will also go toward refinancing existing debt, he added. The existing $280 million credit includes a $70 million "A" loan, a $150 million "B" piece and a $60 million revolver. Lehman also leads this deal, which helped back B&G's acquisition in 1999 of The Heritage Portfolio of Brands from The Pillsbury Co., Indivined B.V. and IC Acquisition Corp. for $192 million. A Lehman official declined to comment.
FleetBoston Financial joined the deal as a syndication agent ahead of the bank meeting, the banker noted, adding that Lehman was still waiting on some other banks that might join the credit at the agent level. He said many existing lenders are being targeted to join the new deal. Pro forma for the transaction, senior leverage is expected in the low twos, while total leverage will stand at 5.2 times debt-to-EBITDA, he added. Parsippany, N.J.-based B&G also has $220 million in bonds outstanding, the banker said. B&G and its subsidiaries manufacture, sell and distribute a portfolio of food products, while Ortega makes a range of Mexican food products. Robert Cantwell, executive v.p. of finance and cfo of B&G, did not return calls.