Restaurant Brands launches $750 million term loan at 99.75 OID

By Sara Rosenberg

New York, April 4 – Restaurant Brands International Inc. held a lender call at 1 p.m. ET on Thursday to launch its fungible $750 million add-on senior secured covenant-lite term loan due Sept. 21, 2030 with original issue discount talk of 99.75, according to a market source.

Pricing on the term loan is SOFR plus 225 basis points with a 0% floor.

JPMorgan Chase Bank is the lead arranger and administrative agent on the deal.

Commitments are due at 5 p.m. ET on Tuesday, the source added.

Proceeds will be used with about $200 million of cash on hand to fund the acquisition of Carrols Restaurant Group Inc.

Under the agreement, Restaurant Brands will acquire all of Carrols’ issued and outstanding shares that are not already held by Restaurant Brands or its affiliates for $9.55 per share in an all-cash transaction. This implies a total enterprise value of about $1 billion. Restaurant Brands and its affiliates currently hold about 15% of Carrols’ outstanding equity.

Closing is expected in the second quarter, subject to customary conditions, including the expiration or termination of the applicable waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976 and Carrols stockholder approval.

Net leverage giving effect to the transaction will increase minimally and the company will remain on track to reach its previously stated net leverage target of mid-4x by the end of 2024.

Restaurant Brands is a Toronto-based quick service restaurant company. Carrols is a Syracuse, N.Y.-based franchisee of Burger King and Popeyes restaurants.

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