Bain Capital Partners and The Blackstone Group Acquire Michaels Stores

On October 31, 2006, Michaels Stores, Inc., North America's largest retailer of arts and crafts materials, was acquired by leading global private investment firms Bain Capital Partners LLC and The Blackstone Group. The US$6 billion acquisition was only slightly smaller than the Toys “R” Us transaction, which was completed by Bain in 2005 for a price of US$6.6 billion plus assumed debt, and which was then the largest retail leveraged buyout (LBO) in North American history and the third-largest LBO of any kind.

On October 31, 2006, as part of the leveraged acquisition, Bain Capital Partners LLC and The Blackstone Group closed US$3.4 billion in senior credit financing facilities (consisting of a US$1 billion asset-based revolving credit facility and a US$2.4 billion Term B credit facility) and issued US$1.4 billion in a combination of senior, senior subordinated and subordinated discount notes. The asset based revolving credit facility was provided by Bank of America, N.A., as administrative agent and collateral agent, and by a syndicate of lenders including Bank of America, N.A., Deutsche Bank AG New York Branch, JP Morgan Chase Bank, N.A. and Credit Suisse. The Term B facility was provided by Deutsche Bank AG New York Branch, as administrative agent, and by a syndicate of lenders including Deutsche Bank AG New York Branch, Bank of America, N.A., JP Morgan Chase Bank, N.A. and Credit Suisse.

Both Bank of America, N.A., as administrative agent and collateral agent (asset-based facility), and Deutsche Bank AG New York Branch, as administrative agent (Term B facility), were represented in Canada by Ogilvy Renault LLP with a team consisting of Kevin Morley, David Amato, Serge Levy and Barry Segal. Bank of America, N.A., as administrative agent and collateral agent (asset-based facility), was represented in the US by Riemer & Braunstein LLP with a team consisting of David Berman, Marjorie Crider and Jason DelMonico. Deutsche Bank AG New York Branch, as administrative agent (Term B facility), was represented in the US by White & Case LLP with a team consisting of partner Eric F. Leicht and associates John Shum, Salman Al-Sudairi and June Nephew.

Michaels Stores, Inc. was represented in Canada by Davies Ward Phillips & Vineberg LLP with a team consisting of Nicholas Leblovic, Siobhan Monaghan, Sonny Bhalla and Alain Roberge and in the US by Ropes & Gray LLP with a team consisting of Julie Jones, Byung Choi, Peggy Ho, Joel Collins, Kristin Jenkins, Alyson Bagley and Monica Singh.