PetSmart pulls debt deal for Chewy after buyers balk
PetSmart Inc. is shelving a $4.65 billion debt sale that would have helped finance its split from its online counterpart Chewy Inc. after struggling to get buyers on board.
The company withdrew its joint junk bond and leveraged loan offering, citing market conditions, according to emailed comments from a PetSmart spokesman Friday. The financing, part of a plan to separate the companies led by private equity firm BC Partners, had yet to generate enough orders to match what it was trying to raise, according to people familiar with the matter, who asked not to be named discussing a private transaction.
It’s the latest transaction to be pulled in the high-yield market, where retail funds saw their first outflow in a month amid a larger selloff from a resurgent coronavirus. Investors had yet to warm up to the deal even after extracting more favorable terms from the BC Partners-led group earlier this week, Bloomberg reported.
Representatives for Barclays Plc, which was leading the bond offering, and JPMorgan Chase & Co., which had led the loan, declined to comment. A spokesperson for BC Partners deferred a request for comment to PetSmart.