SYRACUSE — Carrols Restaurant Group, Inc. (NASDAQ: TAST) shared borrowing plans today that will help the company fund its acquisition of nearly 300 Burger King restaurants.
Carrols will offer $140 million in private placement, senior secured second lien notes. The company will use some of the proceeds from the notes to make cash payments that will be due when it closes on 278 Burger King restaurants it is acquiring from Burger King Corp.
Carrols expects to close on the restaurant acquisition this month. It will pay Burger King Corp. $15.8 million in the deal. Plus, Burger King Corp. will receive a 28.9 percent equity interest in Carrols.
The proceeds from the second lien notes will also help Carrols repay outstanding borrowing, the company said in a news release. Additionally, Carrols will use the proceeds to fund renovations at Burger King restaurants and to help it pay related fees and expenses.
Carrols also said it will enter a new $20 million first lien senior secured revolving credit facility. The company, which is headquartered at 968 James St. in Syracuse, is a major Burger King restaurant franchisee that owned and operated 297 Burger King restaurants as of April 1. It first publicized plans to purchase the 278 company-owned Burger King restaurants in March.
Earlier this month, Carrols wrapped up a spinoff of its Fiesta Restaurant Group, Inc. subsidiary. That company, which owns and operates the Pollo Tropical and Taco Cabana restaurant chains, is now traded on the NASDAQ Global Select Market under the symbol FRGI.
Contact Seltzer at rseltzer@cnybj.com