Rite Aid Corp. has successfully completed a debt offering and a refinancing of its revolving credit facility that were announced last week.


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Rite Aid wraps up debt refinancing

August 20th, 2010

CAMP HILL, Pa. – Rite Aid Corp. has successfully completed a debt offering and a refinancing of its revolving credit facility that were announced last week.

The pharmacy chain said Thursday that the two-pronged refinancing plan extends some of its debt maturities and lowers their interest costs.

In the debt offering, Rite Aid issued $650 million of 8.0% senior secured notes due 2020. The proceeds of the offering, along with available cash, were used to repay and retire a $648 million term loan due in 2015 under its senior secured credit facility, as well as to fund related fees and expenses, according to the company.

Meanwhile, Rite Aid has now replaced its $1.175 billion revolving credit facility due in 2012 with a new $1.175 billion revolver due in 2015. The new credit vehicle has reduced pricing and a five-year maturity, the company said, adding that the maturity will be April 18, 2014, in the event that it doesn't repay, refinance or extend the remaining term loans under its senior credit facility before that time and meets certain other conditions.

The drug store chain has also entered into amendments to its senior credit facility that it said loosen the fixed-charge coverage ratio test and permit the mandatory repurchase of its existing 8.5% convertible notes due 2015, subject to certain conditions.

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