COLTON, Calif. — Stater Bros. Holdings here, parent company of Stater Bros. Markets, said it sold approximately $285 million of new senior notes last week in a private offering — $10 million more than it had initially anticipated, company officials said.
Jack Brown, chairman and chief executive officer, said the offering sold out in less than an hour, “and because of the heavy demand, we took another $10 million” on top of the $275 million in notes that had originally been offered.
The new notes will be due in 2015.
The company said it expects to use the net proceeds to redeem all $175 million of its floating-rate notes, due in 2010; to purchase $15 million of its Class A common stock; to pay costs related to construction of its new distribution center and corporate offices; and to pay a $5 million dividend to its sole shareholder, La Cadena Investments.
Any remaining proceeds will be used for general corporate purposes, the company said.
In response to Stater's offering, Moody's Investor Service, New York, assigned a B2 rating to the new notes and downgraded the chain's corporate family- and long-term debt ratings from B1 to B2.