Jacobs Douwe Egberts, the new business resulting from the Mondelez-D.E Master Blenders coffee merger, marketing €7.6B of debt after borrowing costs for European leveraged loans fall to lowest in three years
June 11, 2014
– Jacobs Douwe Egberts is marketing 7.6 billion euros ($10 billion) of debt after borrowing costs for European leveraged loans fell to the lowest in three years.
The company met with lenders today in London to offer facilities including a 3 billion-euro term loan B maturing 2021 paying an interest margin of 3.25 percentage points more than benchmark rates, according to a person familiar with the deal, who asked not to be identified because the terms are private. Companies pay an average 3.94 percentage points for leveraged loans in euros, the lowest since 2011, according to data compiled by Bloomberg.
Jacobs Douwe Egberts is raising the debt to back its acquisition of Mondelez International Inc.’s coffee business. Proceeds of the financing will help fund a 4 billion-euro payment to Mondelez as well as refinance about 3 billion euros of loans, according to a report from Moody’s Investors Service.
The ratings firm said it plans to rate the debt Ba3, while Standard & Poor’s expects to award the loans a BB grade.
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