Bank of America is leading a $1.2 billion credit to finance S.C. Johnson & Son Inc.'s previously announced plan to buy a Bristol-Myers Squibb subsidiary.

Bank of America, which underwrote the full facility, has since been joined by two co-agents - First National Bank of Chicago and Citibank. Each co-agent has committed $400 million.

A company spokesman said the three banks were leading the facility, but he declined to elaborate.

$700 Million Revolving Credit

The unsecured loan is structured as a $700 million three-year revolving credit and a $500 million seven-year term loan, said a banker familiar with the deal.

Bank of America is one of Johnson's leading banks. It is agent for an existing $250 million backstop credit - which will be replaced by the current deal - and for a European facility.

The privately held company manufactures consumer home care products under the Johnson Wax name as well as insect control and other products.

Johnson is paying $1.15 billion in cash for the Bristol-Myers unit, the Drackett Company, which produces household cleaners and other consumer products. Johnson officials did not return calls.

Pricing will be somewhat higher than under Johnson's current revolving credit, said the banker close to the deal. That facility carries a margin of 37.5 basis points over the London interbank offered rate.

Some bankers speculated that the rate on drawn funds for the new loan would be around 50 basis points. Officials at the three underwriting banks declined comment or could not be reached by press time.

More than $1 billion of the facility may be funded at closing, although this could be reduced substantially afterward. The term loan will probably end up being reduced later this year if the company decides to borrow in the private placement market as is expected, the banker said.

In addition, borrowings would drop if the company goes ahead with current plans to sell parts of the Drackett Company.

Insiders Get First Crack

Banks with existing relationships with Johnson will probably get first shot at participating in the new loan, the banker said. He added that the underwriting banks had not formally set a date for a meeting to discuss specific terms of the new deal.

Banks that are in the company's current U.S. backstop reportedly include ABN Amro, First National Bank of Boston, Barclays Bank, Continental Bank, Credit Lyonnais, First Wisconsin National Bank of Milwaukee, Mellon Bank, and Toronto-Dominion Bank. Officials at these banks declined comment or could-not-reached by press time.

Standard & Poor's Corp. downgraded Johnson's unsecured senior debt to A-minus on news of its planned acquisition, which was announced Tuesday. The new rating takes into account the company's planned divestitures, said an S&P official.

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