S&P gives Double Eagle Buyer, loans B

S&P said it rated Double Eagle Buyer Inc. (Restaurant Technologies Inc.) and its new first-lien senior secured credit facility, which includes an $810 million seven-year term loan and a five-year $100 million revolver, B. The recovery rating on the loans is 3. The outlook is negative.

ECP agreed to acquire Restaurant Technologies in a transaction with an $810 million first-lien term loan and equity.

“We expect Restaurant Technologies' debt burden will be elevated at transaction close but expect it to reduce leverage over the next year. Pro forma for the acquisition, we expect the company's S&P Global Ratings'-adjusted leverage will increase to the 8x area, up from our 5x fiscal year-end 2021 estimate. Compounded with increasing capex over the next 12 months, we believe FOCF will remain very tight for the rating, potentially resulting in revolver borrowings to fund new oil system installations,” the agency said in a press release.

The outlook reflects leverage in the 8x area and negligible FOCF generation in 2022 primarily because of elevated growth capital expenditures spending, S&P said.

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