Bank of America Corp. and Royal Bank of Canada are providing $1.9 billion of term loans and a $900 million unsecured bridge portion, according to a regulatory filing yesterday. The arrangement also includes two revolving credit lines of $950 million and C$750 million ($731 million).
Hudson’s Bay agreed to buy New York-based Saks for $2.4 billion.
To help finance the deal, the Toronto-based company will sell as much as $500 million of common stock, denominated in Canadian dollars, to an entity affiliated with Ontario Teachers’ Pension Plan Board, according to the filing. Hudson’s Bay will also issue the entity warrants for additional 5 million of its common shares.
Under a revolver, money can be borrowed again once it’s repaid; in a term loan, it can’t. Bridge loans usually mature in one year and are often used as backstops to bond offerings or longer-dated bank debt.
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