Tyson Foods, the US meat giant, is to issue a US$500m note offer to pay down debt and is looking to secure a fresh credit facility of up to $1bn.
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The company said today (19 February) that it has started an offering of $500m of unsecured senior notes due 2014.
Tyson plans to offer the notes institutional buyers in the US and overseas.
“The company intends to use the proceeds from the note offering to repay borrowings and terminate commitments under its existing accounts receivables facility, repay and/or refinance other indebtedness and for other general corporate purposes,” Tyson said.
In December, Tyson struck a credit agreement with its lenders with a deal that will see the company use all of its assets as collateral for the loans.
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By GlobalDataToday, the company said it would be arranging a new facility that will be secured by its cash, accounts receivable and inventory and will be guaranteed by the group’s domestic subsidiaries.
“The sale of the notes and closing of the new credit facility are expected to be consummated in March 2009, subject to market and other customary conditions,” Tyson said.
Last month, Tyson posted a quarterly loss on the back of rising feed costs and losses from grain hedging.
The US meat giant booked a first-quarter net loss of US$112m for the three months to 27 December.
