DARDEN RESTAURANTS INC 8-K Report, Corporate Update (Feb 8, 2018)

Summary

Darden Restaurants, Inc. (DRI) announced on February 7, 2018, that it has agreed to sell $300 million in aggregate principal amount of its 4.550% Senior Notes due 2048. This debt offering is a strategic move to manage its existing debt obligations and maintain financial flexibility. The primary use of the net proceeds from this offering is to fund cash tender offers and consent solicitations for its outstanding 6.000% Senior Notes due 2035 and 6.800% Senior Notes due 2037. This suggests a proactive approach to refinancing higher-cost debt with new, lower-cost debt. Any remaining proceeds will be used for general corporate purposes, indicating the company's confidence in its ongoing operations and future growth prospects.

Key Highlights

• 1Darden Restaurants (DRI) is issuing $300 million in new 4.550% Senior Notes due 2048.
• 2The company plans to use the proceeds to repurchase its more expensive outstanding debt (6.000% Senior Notes due 2035 and 6.800% Senior Notes due 2037) through tender offers.
• 3This move indicates a debt refinancing strategy aimed at lowering the company's overall interest expense.
• 4The offering is being conducted under an Underwriting Agreement with Merrill Lynch, Pierce, Fenner & Smith Incorporated, Goldman Sachs & Co. LLC, and Wells Fargo Securities, LLC.
• 5The new notes are registered under a previously filed Form S-3 registration statement.
• 6Any proceeds not used for debt repurchase will be allocated to general corporate purposes.

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