Yum! Brands $3.5 Billion Senior Secured Credit Facility and $2.1 Billion Concurrent Senior Notes Offering
6/16/2016

Davis Polk advised the joint lead arranger, joint bookrunner, administrative agent and collateral agent on a $3.5 billion senior secured credit facility for KFC Holding Co., Pizza Hut Holdings, LLC and Taco Bell of America, LLC, domestic subsidiaries of Yum! Brands, Inc. (“Yum! Brands”). The senior secured credit facilities consist of a $500 million term A facility, a $2.0 billion term B facility and a $1.0 billion revolving credit facility.

 

Davis Polk also advised the representative of the initial purchasers on a Rule 144A/Regulation S offering by KFC Holding Co., Pizza Hut Holdings, LLC and Taco Bell of America, LLC of $2.1 billion aggregate principal amount of senior notes, consisting of $1.05 billion of 5.00% senior notes due 2024 and $1.05 billion of 5.25% senior notes due 2026.

 

Proceeds from the senior secured credit facility and the senior notes will fund a distribution to shareholders, repay borrowings under Yum! Brands’ existing revolving credit facility and facilitate the separation of Yum! Brands’ China Division from Yum! Brands, forming an independent, publicly-traded company.

 

Yum! Brands (NYSE: YUM), based in Louisville, Kentucky, is one of the world’s largest restaurant companies with over 42,000 restaurants in more than 130 countries and territories. Yum! Brands operates the licensed brands of Taco Bell, KFC and Pizza Hut.

 

The Davis Polk credit team included partner Meyer C. Dworkin, associates Jeong M. Oh, Eitan M. Goldberg and A. McLean Crichton. The capital markets team included partner Michael Kaplan, associates Ravi P. Ramchandani and Cameron C. Lewis. The tax team included partner David H. Schnabel and associates Omer Harel and Erin Harvey. Members of the Davis Polk team are based in the New York and London offices.