01—Abstract
Summary
Summary of the 8-K filed June 7, 2024. Cited figures are marked; the original filing is the authoritative source.
Restaurant Brands International Inc. (QSR) disclosed that on June 6, 2024, its subsidiaries 1011778 B.C.
Unlimited Liability Company (the Issuer) and New Red Finance, Inc. (the Co-Issuer) priced an offering of $1,200 milliona in aggregate principal amount of 6.125% First Lien Senior Secured Notes due 2029. The Notes were sold in a private offering to qualified institutional buyers under Rule 144A and to non-U.S. persons under Regulation S. The offering was upsized by $200 million from the previously announced launch size of $1,000 million.
The Notes are guaranteed on a senior secured basis by Restaurant Brands International Limited Partnership and by Holdings' wholly-owned subsidiaries that also guarantee the existing senior secured credit facilities. Closing is expected on or about June 17, 2024. The company expects to use the net proceeds to refinance a portion of the Issuers' existing term loan B facility due September 2030, pay related fees and expenses, and fund general corporate purposes.
In connection with the offering, the term loan B facility is being repriced and downsized from $5,912 millionb at Adjusted Term SOFR plus 2.25% to $4,750 million at Adjusted Term SOFR plus 1.75%, with no change to its maturity. The company states the transactions are expected to be approximately neutral to net leverage and to result in annualized net interest savings.
02—Key points
Key Highlights
- Priced $1,200 million of 6.125% First Lien Senior Secured Notes due 2029, upsized by $200 million from the $1,000 million launch size
- Notes are first lien senior secured obligations of the Issuers, guaranteed by Restaurant Brands International Limited Partnership and by Holdings' wholly-owned guarantor subsidiaries
- Proceeds to refinance a portion of the term loan B facility due September 2030, pay fees and expenses, and for general corporate purposes
- Term loan B facility to be repriced from Adjusted Term SOFR plus 2.25% to Adjusted Term SOFR plus 1.75% and downsized from $5,912 million to $4,750 million
- Term loan B maturity is unchanged; other terms are substantially unchanged
- Company expects the transactions to be approximately neutral to net leverage and to result in annualized net interest savings
- Offering is expected to close on or about June 17, 2024, subject to customary closing conditions
03—Questions
Frequently Asked Questions
How large is the new debt offering and why was it increased?
The Issuers priced $1,200 million in aggregate principal amount of 6.125% First Lien Senior Secured Notes due 2029. This is $200 million more than the $1,000 million size announced at launch on June 6, 2024.
What will the company do with the proceeds?
The company expects to use the net proceeds to refinance a portion of the existing term loan B facility due September 2030, pay related fees and expenses, and for general corporate purposes.
How is the existing term loan B facility changing?
The term loan B facility will be repriced from Adjusted Term SOFR plus 2.25% to Adjusted Term SOFR plus 1.75% and downsized from $5,912 million to $4,750 million, after giving effect to the use of the Notes proceeds. The maturity does not change.
What financial benefit does the company expect from these transactions?
The company expects the transactions to be approximately neutral to net leverage and to result in annualized net interest savings. The filing does not quantify the amount of those savings.
Who guarantees the new notes and what is their ranking?
The Notes are first lien senior secured obligations of the Issuers, guaranteed fully and unconditionally, and jointly and severally, on a senior secured basis by Restaurant Brands International Limited Partnership and by each of Holdings' wholly-owned subsidiaries that also guarantee the Issuers' existing senior secured credit facilities.
04—Continue