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RLPC-Bright Foods seeks 400 mln stg loan for Weetabix
HONG KONG |
HONG KONG Aug 8 (Reuters) - Chinese state-owned food and dairy group Bright Food is refinancing a 400 million pounds ($626.02 million)loan for Weetabix as part of a larger acqusition financing backing its purchase of the iconic British cereal maker, banking sources said on Wednesday.
Bright Foods announced in early May that it was buying a 60 percent stake in Weetabix in a deal which valued the company at 1.2 billion pounds.
Private equity firm Lion Capital and Weetabix's management will own the remaining 40 percent stake.
Bright Food is also financing the acquisition with a $550-850 million three-year loan, a bilateral loan from China Development Bank and a possible bond issue in addition to the refinancing 400 million pounds of Weetabix loans.
The 400 million pounds Weetabix loan has all-in pricing of 275 basis points (b.p.) and is structured as a three-year facility with bullet repayment with no recourse to Bright Foods, bankers said.
The size of the $550-850 million dollar loan will be determined by Bright Food's ability to tap the bond market.
Bright Foods is in the process of getting credit ratings and will issue a bond if market conditions are favourable. A bond issue would reduce the size of the loan to the lower end of the range.
The company sent out term sheets on the $550-850 million three-year loan in June, which is expected to be raised through a Hong Kong entity with a corporate guarantee from Bright Food, banking sources said.
Funds are not required until October, under the long-dated sale and purchase agreement.
The $550-850 million loan is offering a margin of 230 b.p. over Libor with no fees. It is being syndicated on club basis and banks are being asked for minimum commitments of $20 million.
Bright Foods has raised several loans to back recent acquisitions including a $315 million loan backing its acquisition of a controlling stake in Australia's Manassen Foods in October 2011.
It also raised a NZ$162 million ($132.39 million)loan to fund its NZ$82 million ($67.01 million)purchase of a 51 percent stake in New Zealand milk processor Synlait Ltd in February 2011. ($1 = 0.6390 British pounds) ($1 = 1.2236 New Zealand dollars) (Writing by Jacqueline Poh)
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