Portillo’s Inc. Completes Successful Debt Refinancing Transaction

OAK BROOK, Ill., Feb. 06, 2023 (GLOBE NEWSWIRE) -- Portillo’s Inc. (Nasdaq: PTLO), the fast-casual restaurant concept known for its menu of Chicago-style favorites, today announced that it has successfully refinanced its existing credit facility with a new 5-year $300 million Term A Loan, resulting in a significant reduction in interest expense. At prevailing rates, the all-in interest rate on the term debt has been reduced by approximately 270 basis points. The refinancing provides Portillo’s with greater financial flexibility in support of the Company’s ongoing expansion.

The new Term A Loan has an interest rate based on the Secured Overnight Financing Rate (SOFR), plus a credit spread adjustment of 10 to 15 basis points depending on the commitment term, plus a margin of 275 basis points (subject to adjustments based upon the Company’s consolidated total net rent adjusted leverage ratio). The new rate compares favorably to the existing credit facility’s margin, which was based on the London Interbank Offered Rate (LIBOR) plus 550 basis points.

The Company also entered into a new 5-year Revolving Credit Facility, increasing its short-term borrowing capacity from $50 million to $100 million. At closing, the Company borrowed $15 million under the Revolving Credit Facility and has over $80 million of remaining borrowing capacity, net of letters of credit of approximately $4.4 million.

“Since our IPO in 2021, we’ve prudently managed our capital structure by reducing leverage and securing more favorable terms on our debt obligations,” said Michelle Hook, Portillo’s Chief Financial Officer. “Completing a successful refinancing in the current environment reflects well on the strength of our brand and the stability of our business and provides us with additional financial flexibility to execute our growth strategy and operational enhancement initiatives.”

Fifth Third Bank, N.A. served as Joint Lead Arrangers and Joint Bookrunners with BofA Securities, Inc., Wells Fargo Bank, N.A., and MUFG Bank, Ltd. Fifth Third Bank, N.A. also served as the Administrative Agent, L/C Issuer and Swing Line Lender.

About Portillo’s

In 1963, Dick Portillo invested $1,100 into a small trailer to open the first Portillo’s hot dog stand in Villa Park, IL, which he called “The Dog House.” Years later, Portillo’s (NASDAQ: PTLO) has grown to more than 70 restaurants across 10 states. Portillo’s is best known for its Chicago-style hot dogs, Italian beef sandwiches, char-grilled burgers, fresh salads and famous chocolate cake. Download the Portillo’s App for iOS or Android or visit the Portillo’s website to get the best dill on these bun-believably delicious Chicago-style favorites and more. Order ahead for Portillo’s Pickup or delivery. Portillo’s also ships food to all 50 states via its website.