Sportsman’s Warehouse Inc., an outdoor sporting-goods retailer, increased the interest rate it will pay on a $145 million term loan it’s seeking to fund a dividend to shareholders, according to a person with knowledge of the transaction.
The six-year debt will now pay interest at 6 percentage points more than the London interbank offered rate, up from 5.25 percentage points, said the person, who asked not to be identified because the information is private. The minimum on the benchmark will remain unchanged at 1.5 percent.
Sportsman’s Warehouse is proposing to sell the loan at 99 cents on the dollar, the person said, reducing proceeds for the company and boosting the yield to investors.
Lenders are being offered call protection of 102 cents during the first year, the person said. The premium to refinance the debt will drop to 1 cent more than face value in the second year.
Credit Suisse Group AG is arranging the financing and commitments are due by 5 p.m. tomorrow in New York, the person said. The debt is rated B3 by Moody’s Investors Service and B by Standard & Poor’s.
Seidler Equity Partners LP acquired the Midvale, Utah-based company for an undisclosed amount in August 2009, according to data compiled by Bloomberg.
Karen Seaman, chief marketing officer of Sportsman’s Warehouse, didn’t immediately respond to an e-mail seeking comment.
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