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J. Crew Group Said to Seek Lower Rate on $1.18 Billion Loan

Jan. 24 (Bloomberg) -- J. Crew Group Inc., the clothing retailer that TPG Capital and Leonard Green & Partners LP took private, is seeking to lower the rate it pays on a $1.18 billion term loan B, according to a person with knowledge of the transaction.

The interest rate on the debt, due in 2018, will be reduced to 3 percentage points more than the London interbank offered rate and will be sold at par, said the person, who asked not to be identified because the information is private. Libor, a rate banks say they can borrow in dollars from each other, will have a 1 percent floor.

Lenders are being offered six months of soft-call protection of 101 cents, meaning the company would have to pay 1 cent more than face value to refinance the debt during the first six months.

Bank of America Corp. is arranging the transaction and commitments are due Jan. 29 by 5 p.m. in New York, according to the person.

The company’s existing term loan pays interest at 3.25 percentage points more than Libor with a 1.25 percent floor, the person said. The debt was quoted at 101.5 cents on the dollar today, according to data compiled by Bloomberg.

Owen Blicksilver, a spokesman for TPG, declined to comment.

To contact the reporter on this story: Michael Amato in New York at mamato3@bloomberg.net

To contact the editor responsible for this story: Faris Khan at fkhan33@bloomberg.net

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