GPS Hospitality talks $385 million seven-year secured notes to yield 7% to 7¼%; pricing Wednesday

By Paul A. Harris

Portland, Ore., Aug. 4 – GPS Hospitality Holding Co. LLC talked its $385 million offering of seven-year senior secured notes (Caa1/B-/B-) to yield 7% to 7¼%, according to market sources.

Official talk comes in line with initial guidance in the low 7% area.

Books close at 1 p.m. ET Wednesday.

UBS Securities LLC is the left lead bookrunner. KKR is the joint bookrunner.

The Rule 144A and Regulation S for life notes become callable after three years at par plus 50% of the coupon.

The Atlanta-based restaurant franchisee plans to use the proceeds to fully repay the $251 million outstanding under its existing credit facility, fully redeem its preferred units for $101 million, repay its swap for $16 million, fully satisfy its outstanding junior return for $4 million, and use the remaining proceeds for general corporate purposes.

The co-issuer will be GPS Finco Inc.

The company's portfolio includes Burger King, Pizza Hut, and Popeye's.

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