On the heels of the wildly successful Suiza Foods deal, First Union is back with another food/dairy deal, as a $210 million acquisition credit for Dairy Farmers of America is in the market. The credit backs its acquisitions of milk producers, Crowley Foods and Marigold Foods. First Union has reportedly offered agent slots to BANK ONE, Rabobank and Harris Bank. Exact agent titles could not be determined by press time. Calls to officials at Dairy Farmers of America were not returned by press time.
The banker said a reported $140 million in commitments has come in on the deal since First Union's bank meeting on May 15. He said syndication is going well following First Union's other big milk deal for Suiza Foods. "Pro rata's doing poorly, except for milk!" exclaimed the banker, claiming that the revolver, term "A" structure on the deal will not struggle as so many pro ratas have because the sector is hot.
The deal comprises a $30 million L/C facility, a $50 million revolving credit priced at LIBOR plus 2 1/4 % and a $130 million term loan "A" also priced at LIBOR plus 2 1/4 %. The credit is expected to close by the middle of June.