JBS USA revolver expected at $400 million, pricing raised to Libor plus 325 bps

By Sara Rosenberg

New York, Oct. 10 - JBS USA is currently anticipating sizing its five-year ABL revolving credit facility at $400 million, down from $750 million, and pricing was increased to Libor plus 325 basis points from initial talk of Libor plus 275 bps, according to a market source.

The smaller revolver size would come with a $100 million greenshoe, the source said.

As for the company's $500 million six-year term loan, pricing has yet to firm up, but the expectation is that it will be higher than the original talk of Libor plus 550 bps with an original issue discount of 97.

Recent market chatter placed the term loan pricing around Libor plus 750 bps with an original issue discount of 96, but a source told Prospect News that it is all just rumor at this point and nothing official has been announced.

The term loan was launched with a 3.25% Libor floor.

Credit Suisse and GE Capital are the lead banks on the credit facility, with Credit Suisse the left lead on the term loan and GE the left lead on the revolver.

Proceeds will be used to help fund the acquisitions of Smithfield Beef Group Inc. and National Beef Packing Co. LLC by parent company JBS SA.

JBS SA is purchasing Smithfield Beef, a beef processing and cattle feeding operation, from Smithfield Foods Inc. for $565 million in cash.

National Beef is being bought by JBS SA from U.S. Premium Beef LLC for $465 million in cash and $95 million in common stock. In addition, JBS will assume all of National Beef's debt and other liabilities at closing.

JBS USA is a meat processing and packaging company.

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