Ignite Gets $150 Million in Loans for Romano’s Macaroni Purchase
Stock Chart for Ignite Restaurant Group Inc (IRG)
The financing consists of a $100 million revolving credit line and a $50 million term loan from KeyCorp, Bank of America Corp. and Wells Fargo & Co., according to a regulatory filing today.
Ignite, owner of Joe’s Crab Shack and Brick House Tavern + Tap, agreed to buy Romano’s Macaroni Grill for $55 million from private-equity firm Golden Gate Capital. The Houston-based company said yesterday it expects to complete the acquisition during the second quarter.
“It takes Ignite to nearly $1 billion in revenue overnight,” Raymond Blanchette, the company’s chief executive officer, said yesterday on a conference call to discuss the purchase. “And while we aren’t making the purchase just to be a larger company, there are definitely economies of scale that we fully expect to realize.”
Romano’s, which owns and operates 186 restaurants in the U.S., had revenue last year of about $385 million, according to a statement yesterday.
The new bank debt also will be used for general corporate purposes, according to the regulatory filing. Under a revolver, money can be borrowed again once it’s repaid; in a term loan, it can’t.
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