Nestle Said to Complete 10 Billion Euros of Loans to Refinance

Sept. 30 (Bloomberg) -- Nestle SA, the world’s largest food company, plans to sign 10 billion euros ($13.5 billion) of loans today to replace existing credit lines, according to a person with knowledge of the matter.

The maker of Nescafe coffee is arranging two 5 billion-euro revolving credit facilities maturing in one and five years, said the person, who asked not to be identified because the details are private. The debt will refinance a one-year loan maturing next month and a five-year credit line expiring in 2015, according to data compiled by Bloomberg.

Nestle spokesman Philippe Aeschlimann referred questions about the status of the loans to Citigroup Inc., which is helping to coordinate both transactions. Officials at the bank, who asked not to be named because the terms are private, declined to comment on the financing.

The Vevey, Switzerland-based company will pay interest at 10 basis points, or 0.1 percentage point, more than benchmark lending rates on the one-year loan and 12.5 basis points on the five-year debt, according to preliminary data compiled by Bloomberg. The loans pay commitment fees of one basis point and 3.75 basis points respectively.

The loans are divided into 1.8 billion-euro and $4.3 billion-equivalent portions, the person said. A revolving credit facility is a type of debt where money can be borrowed again once it’s repaid.

To contact the reporter on this story: Stephen Morris in London at smorris39@bloomberg.net

To contact the editors responsible for this story: Michael Shanahan at mshanahan3@bloomberg.net; Faris Khan at fkhan33@bloomberg.net