01—Abstract
Summary
Summary of the 8-K filed September 4, 2024. Cited figures are marked; the original filing is the authoritative source.
Restaurant Brands International Inc. (NYSE/TSX: QSR) disclosed on September 3, 2024 that its subsidiaries, 1011778 B.C.
Unlimited Liability Company (the Issuer) and New Red Finance, Inc. (the Co-Issuer), entered into a purchase agreement with Morgan Stanley & Co. LLC, as representative of the initial purchasers, for a private offering of $500 milliona in aggregate principal amount of 5.625% First Lien Senior Secured Notes due 2029. The notes are being sold to qualified institutional buyers under Rule 144A and to non-U.S. persons under Regulation S, and the offering is expected to close on or about September 13, 2024. The Issuers plan to use the proceeds, together with cash on hand, to redeem in full their outstanding $500 million of 5.750% First Lien Senior Secured Notes due 2025 and to pay related fees and expenses.
Per the pricing press release (Exhibit 99.2), the combined effect of the new notes offering and the redemption of the 2025 Notes will be neutral to net leverage and accretive to interest expense. The notes will be guaranteed by Restaurant Brands International Limited Partnership and by Holdings' wholly-owned subsidiaries that guarantee the Issuers' existing senior secured credit facilities.
The company also called the 2025 Notes for redemption at 100.000%b of principal plus accrued and unpaid interest, though the filing states it is not itself a notice of redemption. The filing is primarily a refinancing and liability management event rather than an operating update, and it contains no operating or earnings figures.
02—Key points
Key Highlights
- Issuers priced $500 million of 5.625% First Lien Senior Secured Notes due 2029 in a Rule 144A and Regulation S private offering.
- Proceeds, together with cash on hand, will fund the full redemption of $500 million of 5.750% First Lien Senior Secured Notes due 2025 plus related fees and expenses.
- The 2025 Notes are called for redemption at 100.000% of principal plus accrued and unpaid interest to the redemption date.
- Per the pricing press release, the refinancing is expected to be neutral to net leverage and accretive to interest expense.
- The new notes are fully and unconditionally guaranteed on a first lien senior secured basis by Restaurant Brands International Limited Partnership and by subsidiaries that guarantee the existing senior secured credit facilities.
- Closing is expected on or about September 13, 2024, subject to customary closing conditions.
- The notes and guarantees are unregistered under the Securities Act and cannot be offered or sold in the U.S. absent registration or an exemption.
03—Questions
Frequently Asked Questions
What is the size and maturity of the new notes?
The Issuers are offering $500 million in aggregate principal amount of 5.625% First Lien Senior Secured Notes due 2029.
What will the company do with the proceeds?
The Issuers expect to use the proceeds, together with cash on hand, to redeem in full their $500 million of outstanding 5.750% First Lien Senior Secured Notes due 2025 and to pay related fees and expenses.
Will this refinancing change the company's leverage or interest costs?
The pricing press release states that the combined effect of the notes offering and the 2025 Notes redemption will be neutral to net leverage and accretive to interest expense.
Who guarantees the new notes?
The notes are guaranteed fully and unconditionally, jointly and severally, on a first lien senior secured basis by Restaurant Brands International Limited Partnership and by each of its wholly-owned subsidiaries that also guarantee the Issuers' existing senior secured credit facilities.
When is the offering expected to close?
The offering is expected to close on or about September 13, 2024, subject to customary closing conditions under the Purchase Agreement.
04—Continue