FAT Brands Inc. announced its intention to refinance its existing term debt with a new “whole business securitization” financing facility.
The company intends to refinance its existing $24 million term debt with a new $40 million securitized financing facility, expected to be comprised of $20 million of senior notes and $20 million of senior subordinated notes.
The net proceeds from the sale of the notes are expected to be used:
to repay all of the existing indebtedness and accrued interest under the term debt,
to pay the transaction costs and fund the reserve accounts associated with the securitized financing facility, and
for potential acquisitions, working capital purposes, general corporate purposes, or the repayment of other indebtedness.
The consummation of the offering is subject to market and other conditions and is anticipated to close in the first quarter of 2020. However, there can be no assurance that the company will be able to successfully complete the refinancing transaction on the terms described or at all.
FAT Brands currently owns eight restaurant brands: Fatburger, Buffalo’s Cafe, Buffalo’s Express, Hurricane Grill & Wings, Elevation Burger, Yalla Mediterranean and Ponderosa and Bonanza Steakhouses, and franchises over 380 units worldwide.
