Deutsche Bank is about to launch syndication of its $900 million deal for Fleming and is said to be showing the loan to large accounts. A banker said the credit, split between a $600 million revolver and $300 million term loan, backs the $430 million acquisition of Core-Mark International and Head Distributing, and refinances existing debt. Pricing on the revolver is set on a grid ranging from LIBOR plus 13/ 4% to 2%, while the term loan is priced at LIBOR plus 21/ 4%.
The acquisition will expand Fleming's wholesale grocery distribution network. The refinancing move will also eliminate all debt securities maturing before 2007 and will result in an improved leverage position, including cutting debt-to-capital and debt-to-EBITDA ratios. Calls to Fleming spokesman Shane Boyd, were not returned.