TEXAS PACIFIC CLOSES DEAL ON PURCHASE OF J. CREW

NEW YORK — The purchase of 88 percent of J. Crew Group by Texas Pacific Group for a reported $540 million was completed Friday.
The deal had run into a snag last week with the cancellation of a private placement of bonds needed to finance the purchase, but the bond sale was revived after the terms were sweetened.
Last Tuesday, the sale of $150 million of senior subordinated notes and $142 million in discount notes (zeros) was completed. The interest rate on the senior subordinated notes was increased to 10 3/8 percent from 10 percent and the zeros were marked up to 13 1/4 percent from 12 7/8.
In addition to the higher interest rate, the credit rating on the senior subordinated notes was upgraded to B3 from Caa1 by Moody’s Investors Service after adjustments to the terms of the planned purchase reduced the debt of the surviving company by about $49 million.

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