First Union and Merrill Lynch are set to launch syndication of a $800 million senior secured loan for Jacksonville, Fla-based grocery chain Winn-Dixie Stores, Inc. and act as co-leads on a $300 million bond offering for the company. Kelly Roth, treasurer, said the company signed commitments with the banks last week and will hold a bank meeting next week. She would not comment on expected pricing on the facility. Roth said pricing will be higher than it's been on the company's past credits as its debt rating is BBB- compared to a previous rating of A-. "We have a long history with First Union and Merrill and selected them based on the proposals that came in," she said.
As first reported on LMW's web site the $800 million credit comprises a $200 million, 364-day and a $200 million, five-year revolver expected to price at LIBOR plus 21⁄4% and a $400 million term loan "B" expected to price at LIBOR plus 2 3⁄4%. The term loan "B" piece will be offered to institutional investors."The term loan "B" and the bonds will be used to refinance $700 million in outstanding debt," she said.