Fred’s entered into a second amended and restated commitment letter with Bank of America June 9 to increase its financing for the deal. The amended letter increased Fred’s financing from $1.2 billion to $1.65 billion. It also extended the commitment date to July 31, with a possible extension to Oct. 31; provided for a senior secured asset-based term loan to acquire certain intellectual property belonging to Rite Aid; and permitted certain real estate financing and sale-leaseback transactions.
The SEC filing also noted Fred’s entered into an amended and restated term loan commitment letter with various credit agencies. Under the amended commitment letter, Fred’s received an increased financing commitment of $100 million, from $450 million to $550 million; extended the initial outside commitment date to July 31, with the option to extend the date to Oct. 31; and permitted certain real estate financing and sale-leaseback transactions.
Fred’s stands to acquire roughly 1,200 divested Rite Aid stores, as well as certain Rite Aid intellectual property, corporate infrastructure and distribution centers, if the Federal Trade Commission does not block the proposed merger between Rite Aid and Deerfield, Ill.-based Walgreens Boots Alliance.
Officials expect the FTC to issue a decision on the proposed merger by July 7.
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