By Paul A. Harris
St. Louis, June 18 - Wendy's/Arby's Restaurants, LLC priced a $565 million issue of 10% seven-year senior unsecured notes (B2/B+) at 97.533 to yield 10½% on Thursday, according to informed sources.
The yield was printed 50 basis points beyond the wide end of the 9¾% to 10% price talk.
Credit Suisse, Citigroup Global Markets Inc. and Banc of America Securities LLC were joint bookrunners.
Proceeds will be used to optionally prepay about $125 million senior secured term loan debt and to make a distribution of the remaining proceeds to Wendy's/Arby's Group, which will used for general corporate purposes. Those purposes may include working capital, the funding for key strategic growth initiatives, including new unit development, acquisitions of other restaurant companies, repayment or refinancing of debt and the return of capital to its stockholders, including through stock repurchases and/or dividends.
A modification was made to the restricted payments covenant.
The issuer is a subsidiary of Atlanta-based Wendy's/Arby's Group, Inc. and is to be renamed Wendy's/Arby's Restaurants, LLC.
Issuer: Wendy's/Arby's Restaurants, LLC
| Face amount: | $565 million
|
| Proceeds: | $551 million (approximate)
|
| Maturity: | July 15, 2016
|
| Security description; | Senior unsecured notes
|
| Bookrunners: | Credit Suisse Securities (USA) LLC, Banc of America Securities LLC, Citigroup Global Markets Inc.
|
| Coupon: | 10%
|
| Price: | 97.533
|
| Yield: | 10½%
|
| Spread: | 702 bps
|
| Call features: | Make-whole at Treasuries plus 50 bps until July 15, 2012, then callable at 107.50, 105.0, 102.50, par on and after July 15, 2015
|
| Equity clawback: | 35% at 110.0 until July 15, 2012
|
| Trade date: | June 18
|
| Settlement date: | June 23
|
| Ratings: | Moody's: B2
|
| Standard & Poor's: B+
|
| Distribution: | Rule 144A/Regulation S
|
| Price talk: | 9¾% to 10%
|
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