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S&P gives Franchise Group loan BB-
S&P said it assigned Franchise Group Inc.’s new $425 million first-lien term loan BB- issue and 2 recovery ratings. Concurrently, the agency affirmed Franchise Group’s B+ issuer rating.
Franchise Group will use the proceeds to fund its purchase of Badcock Home Furniture.
“The acquisition increases leverage to the mid-4x area, but we believe there is room for leverage to improve sequentially on higher EBITDA base and subsequent debt reduction. The company will fund the $550 million Badcock acquisition with a new $425 million first-lien term loan (rated) and a new $150 million second-lien term loan (not rated),” S&P said in a press release.
The outlook is stable.
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