ROUNDY'S PLANS TO REFINANCE ALL DEBT

Elliot Zwiebach

MILWAUKEE -- Roundy's Supermarkets here said last week it plans to fund a dividend as part of its effort to refinance substantially all of its existing debt.

The company said it intends to issue $175 million in floating rate senior notes due in 2012 and $150 million in senior subordinated notes due in 2013 and enter into a new $825 million senior credit facility composed of a $700 million term loan and a $125 million revolving credit facility.

The proceeds will be used to repay the company's total indebtedness of approximately $118 million under its existing senior credit facility; to conduct a tender offer and consent solicitation for any and all of the $300 million outstanding of its 8-7/8% senior subordinated notes due in 2012; and to fund a $550 million dividend to its shareholders. Roundy's paid a dividend totaling $84.7 million to shareholders in the second quarter, which ended June 30.

"Roundy's has deleveraged its balance sheet and generated equity value, and this recap is a way to realize that equity," according to an industry analyst.