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Susser Holdings in New $500MM Credit Facility

April 10, 2013, 07:09 AM
Filed Under: Retail

Susser Holdings Corporation closed on a new $500 million revolving credit facility with a variable interest rate initially set at LIBOR plus 200 basis points.

Concurrently, the company has notified the trustee of its $425 million of 8.5% senior notes due 2016 that it is redeeming the notes effective May 15, 2013.  Susser plans to initially use approximately $250 million of the capacity under the new credit facility, along with existing cash, to retire the notes which are callable at a price of 104.25%. Including the $18.1 million call premium and approximately $4 million of transaction expenses, a total of $447 million (plus accrued interest) will be required to retire the notes. The Company expects to recognize a one-time pre-tax charge of approximately $26 million, or $0.76 to $0.78 per diluted share, in connection with the refinancing.

"With the refinancing of our high-yield debt, based on current LIBOR rates, we expect to save an estimated $30 to $32 million of annual pre-tax interest expense, which would add approximately $0.90 to $0.95 to our diluted earnings per share," said Sam L. Susser, Susser Holdings' president and chief executive officer.

"The surplus capacity on the new lower-cost revolving credit facility will help us execute our plan to drive long-term growth both organically and through acquisitions," he said.

The $500 million revolving credit facility includes an accordion feature that would enable the company to expand it by an additional $100 million, to a total of $600 million, to finance future growth.  The facility expires April 8, 2018.  Susser Petroleum Partners has a separate $250 million revolving credit facility that also has a $100 million accordion feature.

Susser Holdings Corporation is a third-generation family led business based in Corpus Christi, Texas that operates more than 560 convenience stores in Texas, New Mexico and Oklahoma under the Stripes banner.

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