Rite Aid $2 billion credit facility launch expected shortly

By Sara Rosenberg

New York, April 15 - Rite Aid Corp. is expected to launch its $2 billion credit facility in the near future, according to market sources, with the expectation being that the deal will come next week since this week has a holiday schedule. Citigroup Global Markets Inc. and J.P. Morgan Securities Inc. are joint lead arrangers on the deal.

The loan is anticipated to consist of an $850 million revolver with price talk in the area of Libor plus 350 basis points and a $1.15 billion term loan with price talk of Libor plus 375 basis points, sources said, adding that details have not firmed up completely as of yet. Both tranches are due in April 2008.

Currently, the syndicate is said to be pulling in some core relationship investors prior to the general syndication launch, sources said.

Proceeds will be used to repay the company's existing $1.37 billion senior secured credit facility due March 2005 and its $107 million synthetic lease due March 2005 and to replace the existing $500 million revolver, which is undrawn.

The Camp Hill, Pa. retail drugstore chain's loan is expected to close by the end of May.

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