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California Pizza outlines size, tranches on buyout financing facility
By Sara Rosenberg
New York, June 10 - California Pizza Kitchen Inc. disclosed details on its proposed $290 million senior secured credit facility that will be used to help fund its acquisition by Golden Gate Capital, according to an SC TO-T recently filed with the Securities and Exchange Commission.
The facility consists of a $260 million six-year term loan and a $30 million five-year revolver, with both tranches expected to be priced at Libor plus 425 basis points with a 1.25% Libor floor.
The revolver is expected to have a 50 bps unused fee.
Amortization on the term loan is 1% per year, with the balance due at maturity.
There is a $75 million accordion feature.
Financial covenants include a minimum fixed-charge coverage ratio and a maximum rent adjusted leverage ratio.
GE Capital Markets and Jefferies & Co. are the lead joint lead arrangers and bookrunners on the deal, with GE the administrative agent.
Under the agreement, California Pizza is being bought for $18.50 per share in cash, or about $470 million. Golden Gate Capital has already commenced a tender offer for all of the company's outstanding shares that will expire on July 6.
Other funds for the transaction will come from $225 million in equity.
Closing is expected in the third quarter, subject to satisfaction of a minimum tender condition, clearance under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, which has already been obtained, stockholder approval, receipt of financing and other customary conditions.
California Pizza is a Los Angeles-based casual dining chain featuring hearth-baked pizzas, pastas, salads, appetizers, soups, sandwiches and desserts.
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