SAN FRANCISCO - Bank of America, Citicorp USA, and Bank of Nova Scotia have committed $1.5 billion in debt to Levi Strauss & Co., the clothing maker said Tuesday.
The senior secured credit facility - made up of $750 million in revolving credit and a $750 million term loan - replaces Levi's existing bank debt under more favorable terms.
The new agreement reduces borrowing costs, extends the maturity of the loan to August 2003 from January 2002, and enables the company to avoid incremental fees and expenses associated with the existing debt. Levi expects the loan, which is subject to customary conditions, to be finalized in late January.
The banks' confidence in the company is significant, coming when many bank loans are defaulting. Additionally, the privately held company released lackluster earnings for the third quarter, when net income fell to $37.8 million, from $55.2 million in the same quarter of 1999.