FAT Brands Strengthens Financial Framework with Twin Peaks Refinancing

FAT Brands Moves Forward with Strategic Refinancing

FAT (Fresh. Authentic. Tasty.) Brands Inc. (NASDAQ: FAT), a prominent player in the global franchising landscape, has taken significant strides by successfully refinancing the Twin Peaks credit facility. This pivotal moment not only solidifies the financial foundation of the Twin Hospitality Group Inc. but also sets the stage for exciting developments ahead. As FAT Brands strategically prepares for the potential public listing of Twin Hospitality Group, this refinancing is more than just a routine financial maneuver; it represents a significant leap forward in enhancing operational flexibility and growth potential.

Details of the Refinancing Deal

The refinancing process involved the issuance of new notes, totaling an impressive principal balance of $416.7 million, segmented into four tranches with an average fixed interest rate of 9.5% per annum. This transaction was orchestrated by Twin Hospitality I, LLC, a fully owned subsidiary of the Twin Hospitality Group Inc. The nuances of this complex financial restructuring highlight FAT Brands' commitment to maintaining robust fiscal health and supporting the dynamic growth of its franchise operations, particularly through the Twin Peaks brand.

Understanding the Notes Structure

The newly issued notes can be exchanged for corresponding interests in two tranches: Class A2IIB2 and Class A2IIB2M2, which together can accommodate amounts up to $731.5 million. These financial instruments are thoughtfully designed to reflect the core attributes of the existing notes, ensuring flexibility for investors and stability for the company.

Leadership Insights on Growth Plans

Ken Kuick, the Co-CEO of FAT Brands, expressed enthusiasm regarding this important milestone. He commented, "We are pleased to announce the successful pricing of the Twin Peaks Series 2024-1 notes. This financing approach not only stabilizes the Twin Peaks financial structure but also propels us toward the establishment of a standalone public company. Our relentless pursuit of growth places us in a position to expand operational efficiencies significantly."

Twin Peaks: A Fast-Growing Concept

Kuick further highlighted the remarkable performance of Twin Peaks, mentioning that the brand's growth trajectory remains strong, with nine new lodges already opened this year, bringing the total to 115 locations. This rapid expansion underscores the increased demand for Twin Peaks' unique blend of sports dining experiences, characterized by made-from-scratch food and a vibrant atmosphere.

Collaborators and Advisors

The successful execution of this financial restructuring was made possible through the diligent efforts of Jefferies LLC, which acted as the exclusive structuring agent and bookrunner for the transaction. Legal expertise was provided by two firms, with Katten Muchin Rosenman LLP representing FAT Brands Inc., while King & Spalding LLP served as legal advisors for Jefferies LLC. These partnerships reflect FAT Brands’ strategic planning and execution capabilities in pursuing favorable financing options.

About FAT Brands

Founded on innovation and expansion, FAT Brands operates a diverse portfolio of 18 beloved restaurant brands, including Twin Peaks, Fatburger, and Johnny Rockets. Their engaging franchise model has fostered a global network of over 2,300 locations, catering to various dining preferences. By focusing on operational excellence and customer satisfaction, FAT Brands continues to set itself apart in a competitive industry.

Exploring Twin Peaks

Since its inception in 2005, Twin Peaks has evolved into a prominent name in the casual dining sector. The brand consistently delivers an unmatched sports dining experience, combining delicious food with an energetic atmosphere. With its ever-expanding footprint across the United States and beyond, Twin Peaks is poised to capture an even larger share of the dining market.

Frequently Asked Questions

What is the primary reason for FAT Brands' refinancing?

The refinancing aims to strengthen Twin Peaks' financial structure while facilitating growth and the potential public listing of Twin Hospitality Group.

How much has FAT Brands raised through the refinancing?

FAT Brands has successfully raised $416.7 million through the issuance of new fixed-rate notes.

What is the interest rate on the new notes?

The new fixed-rate notes have a weighted average interest rate of 9.5% per annum.

What is the significance of Twin Peaks within FAT Brands?

Twin Peaks is noted as FAT Brands' fastest-growing concept, indicating its strategic importance for future growth.

How many Twin Peaks locations are currently in operation?

As of now, Twin Peaks operates a total of 115 locations successfully serving diners across the U.S. and Mexico.

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