Firm Advises Lead Lender GSO Capital in a $550 Million Second Lien Financing for the $2.7 Billion Acquisition of Department Store Chain Belk, Inc.

December 14, 2015

Willkie advises GSO Capital, a lending affiliate of The Blackstone Group, in its bank deal to provide second lien facilities to finance a portion of the acquisition of Belk, Inc. by private equity sponsor Sycamore Partners. 

On December 10, GSO Capital Partners, one of the largest credit-focused alternative asset managers in the world and a lending affiliate of The Blackstone Group, led the arrangement of a $550 million second lien secured term loan facility to finance, in part, the acquisition of Belk, Inc. by private equity sponsor Sycamore Partners for approximately $2.7 billion. First lien financing consisting of a $1.5 billion secured term loan and an $900 million working capital ABL facility were provided by a syndicate of other lenders. Willkie advised GSO with respect to its commitment to provide the second lien facilities, the financing aspects of the acquisition agreement, syndication matters, intercreditor arrangements and the definitive documentation for the second lien secured term loan facility.

Belk, Inc. is a 127-year-old department store chain concentrated in the southern United States and is headquartered in Charlotte, North Carolina. Belk has a major department store business in the United States, with almost 300 locations in 16 Southern states. Belk also operates an e-commerce business. Sycamore Partners is a private equity firm in New York known for investing in retail companies and seeking to reinvigorate them, and oversees more than $3.5 billion in capital. Sycamore purchased Talbots in 2012.

The Willkie finance team was led by partner Michael Zinder, and included finance associates Joshua Deason, Adam Keith and Ryan Hartnett as well as special counsel Cindy Chernuchin. Corporate and acquisition agreement matters were led by partner William Gump and associates Bradley Friedman and Robert Rizzo. Substantial assistance was also provided by finance partner Leonard Klingbaum on intercreditor matters, of counsel William Thomas and associate Annise Maguire on environmental matters, partner Eugene Chang on IP matters, partner David Drewes and associate Kathryn Crowe on real estate matters, partner Richard Reinhold and associate Kapiljeet Dargan on tax matters, and partner Mark Holdsworth and associate Andrew Shapiro on benefits matters.