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REVCO ANNOUNCES PROPOSED COMPREHENSIVE REFINANCING

 REVCO ANNOUNCES PROPOSED COMPREHENSIVE REFINANCING
 TWINSBURG, Ohio, Nov. 9 /PRNewswire/ -- Revco D.S., Inc.


(NYSE: RXR) filed today with the Securities and Exchange Commission registration statements for equity and debt financings which comprise two of the three elements of a complete refinancing of the company. One filing covers a proposed rights offering, including certain standby purchase arrangements. The other covers the proposed issuance, in an underwritten offering, of new senior notes due 1999. The third element involves new credit facilities provided by a consortium of banks. The net effect of the refinancing program would be a material reduction in Revco's interest expense and leverage.
 The proposed recapitalization plan involves:
 -- Borrowings by Revco under a $150 million secured term loan facility and execution of a $150 million secured revolving credit facility, co-agented by Banque Paribas, Continental Bank N.A. and GE Capital Corporate Finance Group, Inc.;
 -- Sale by Revco of $125 million principal amount of the new senior notes through a senior notes offering;
 -- Sale by Revco of approximately $110 million of common stock through the rights offering and standby purchase arrangements; and
 -- Repayment in full of Revco's three existing debt securities in an amount aggregating $433.2 million and replacement of Revco's existing working capital credit agreement.
 If the company is unable to successfully conclude all aspects of the recapitalization plan, none of the elements will be completed.
 Under the terms of the rights offering, Revco will issue transferable rights to purchase additional shares of common stock to its stockholders of record at a future date to be announced.
 The subscription price of the rights will be determined by the board of directors, in consultation with its financial advisor, immediately prior to the date the registration statement is declared effective by the Securities and Exchange Commission. The board's approval of the rights offering is predicated upon the subscription price being not higher than $8 per share nor less than $7 per share. When determined, the subscription price could be higher or lower than or equal to the market price for the common stock at such future time.
 Rights holders who exercise their rights in full will also have the opportunity to subscribe at the subscription price for additional shares of common stock which are not otherwise purchased by rights holders.
 Zell/Chilmark Fund, L.P. and Magten Asset Management Corporation (on behalf of its individual investment advisory clients), which collectively own approximately 34 percent of Revco's common stock, have indicated that at the time of pricing, they expect to enter into an agreement with the company to exercise their respective basic subscription privileges and to purchase, on a standby basis, all unsubscribed shares following the expiration of the rights offering.
 Revco is a Twinsburg, Ohio-based company which operates 1,149 drug stores in nine contiguous eastern states, and has 16,000 employees. The company emerged from protection under Chapter 11 of the Bankruptcy Code on June 1, 1992.
 Registration statements relating to these securities have been filed with the Securities and Exchange Commission but have not yet become effective. These securities may not be sold nor may offers to buy be accepted prior to the time the registration statement becomes effective. This news release shall not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of these securities in any state in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state. Each offering will be made only be means of a prospectus.
 -0- 11/9/92
 /CONTACT: Diana Lueptow of Revco D.S., Inc., 216-425-9811, ext. 6145 (media), or 216-425-9811, ext. 2811 (investor)/
 (RXR) CO: Revco D.S., Inc. ST: Ohio IN: REA SU: FNC


KK -- CL010 -- 8871 11/09/92 16:10 EST
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Publication:PR Newswire
Date:Nov 9, 1992
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