DineEquity Inc. on Monday said that it signed a new $950 million credit facility, and will sell 56 company-operated Applebee's restaurants in Missouri, Illinois and Virginia as part of an ongoing effort to improve its balance sheet.
The Glendale parent of Applebee's Neighborhood Grill & Bar and IHOP restaurants plans to use proceeds from the two-part senior secured credit agreement, made by a group led by Barclays Bank Plc, to pay for previously announced tender offers, redeem shares of Series A perpetual preferred stock and similar actions.
In a separate announcement, DineEquity said the Applebee's restaurant sales in three states should net $38 million. DineEquity bought Applebee's in 2007 in a $2 billion leveraged buyout. The company, which had total debt of $2.2 billion at the end of June, has been working to reduce debt by selling restaurants to franchisees.
Thirty-six of the restaurants are located in St. Louis and Illinois. The buyer is Mid Rover Restaurants LLC, which already owns 12 Applebee's locations in Louisiana. The
Virginia restaurants are being sold to a group called Apple Investors Group LLC, which owns seven Applebee's restaurants in New Mexico and 18 IHOP restaurants across the country.
Shares were up $1.75, or 3.7 percent, to $48.47 in midday trading on the New York Stock Exchange.
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