Rite Aid intends to sell $250M in senior notes

CAMP HILL, Pa. Rite Aid announced on Monday its intention to sell $250 million in senior notes due 2019, which is part of a plan to refinance all of its September 2010 debt maturities.

The pharmacy retailer plans to sell $250 million aggregate principal amount of senior secured notes due 2019. The offering is part of a plan to refinance its first lien accounts receivable securitization facility and second lien accounts receivable securitization facility due September 2010. 

As of Oct. 16, there was $475 million outstanding under the securitization facilities. 

Also included in the refinancing is an increase in borrowing under its existing $525 million loan due 2015 by $125 million to $650 million. The company also intends to enter into an amendment to its senior secured credit facility, which will increase the maximum borrowing capacity under its existing senior secured revolving credit facility from $1 billion to $1.175 billion.

 Rite Aid stated that it plans to use the net proceeds from the sell of the notes, together with the proceeds from the increased term loan and borrowings under the revolving credit facility, to repay and cancel its accounts receivable securitization facilities and to fund related fees and expenses. Upon completion of the plan, Rite Aid will have refinanced all of its September 2010 debt maturities.