Financing Is Set for Herbalife

Morgan Stanley and Merrill Lynch & Co. are arranging the refinancing of $225 million of loans for Herbalife International Inc. as the distributor of weight-loss and nutritional supplements prepares to sell shares to the public, according to a regulatory filing filed Friday.

The financing for the Los Angeles-based company will include a $200-million term loan and a $25-million revolving credit, Herbalife said in the Securities and Exchange Commission filing. Interest rates and maturities on the credits weren’t disclosed.

The financing being replaced includes $205 million, consisting of a term loan and revolving credit, the filing said. As of June 30, $71.1 million of the term loan was outstanding.

The company plans to sell as much as $345 million of shares through Morgan Stanley and Merrill Lynch. The shares will be traded on the New York Stock Exchange.

Moody’s Investors Service rates Herbalife’s bank loans Ba3, three levels below investment grade. Standard & Poor’s ranks the company the equivalent at BB-minus.

Whitney & Co. and Golden Gate Private Equity Inc. acquired Herbalife in July 2002.