Nov. 8 (Bloomberg) -- Arby’s Restaurant Group Inc. cut the rate it will pay on a $335 million loan funding a dividend to the fast-food chain’s owners, according to a person with knowledge of the transaction.
The interest rate was lowered to 4 percentage points more than the London interbank offered rate, from 4.25 percentage points originally proposed, said the person, who asked not to be identified because terms aren’t set. Libor will have a 1 percent floor.
Arby’s, which is majority owned by private-equity firm Roark Capital Group, plans to use proceeds from the debt plus $46 million of cash to finance a $370 million payout to shareholders, according to an Oct. 31 Moody’s Investors Service report.
The Atlanta-based restaurant chain also reduced the discount to investors in the dividend-paying loan to 99.75 cents on the dollar, after initially offering 99 cents, according to the person with knowledge of the deal.
Credit Suisse Group AG, the bank arranging the financing, is seeking commitments from lenders by 2 p.m. today, the person said. The deal also includes a $35 million revolving credit line.
Under a revolver, money can be borrowed again once it’s repaid; in a term loan, it can’t.
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